What does Disk Overloaded in the status bar mean?

This means that the disk was not able to keep up with the read/write speed. This is normal behavior when first starting a large torrent and writing to a slow disk (e.g. USB 2.0 Drive, Network Mount) as Windows must create the file before it can be written. Allow the torrent client some time to complete the file creation process, and this status should disappear.