There isn't any malfunctioning in the GPS system. It is a safety feature that Toyota has implemented, as if the "Warning" and disclaimer screen and "I Agree" button are not enough when you start the car or start to use the navigation. It's a liability issue for automakers. Early Lexus models' GPS units doesn't have a speed sensor and as well as some Honda GPS units.
There is a defeat for Lexus GPS systems which involves cutting the speed sensor wire to the GPS and putting a switch in between. The switch would be turned off when the vehicle is in motion, fooling the system in thinking it's not moving to accept user inputs. But once the input is set, the switch would need to be turned back on, otherwise the GPS will think the vehicle is stopped.
But to say the least for automakers concerned about our safety, at least Toyota hasn't gone overboard like Nissan/Infiniti. Nissan/Infiniti GPS units require the vehicle in Park before it will accept input (and they don't have touchscreens

). I think a better setup with be to use the passenger airbag sensor to detect the presence of a passenger and allow GPS programming.
BTW, the JBL system rocks.