There is a tendency in all languages to use drastic language and for example replace warm by hot when talking in superlatives. But this doesn't mean it's wrong to use too warm.
I think it rarely gets really hot in the Netherlands, so this sentence may well mean what it says. Wikipedia's article on the Netherlands uses De Bilt weather station as an example for the climate. There, the average high temperature in July is 23 °C and the record high over the last 30 years is 37 °C. Apparently, the highest temperature ever recorded in Europe was 45 °C in Athens (much, much hotter than any Dutch city in the summer), which is the same record as for Canada (Saskatchewan). 27 US states have higher temperature records.
More or less. Both sentences have the primary meaning "The temperature in July is too high for me". But they also say a bit more about the temperature. If you say "het is te heet", you are implying that it is hot. If you say "het is te warm", you are implying that it is warm. There are no precise definitions, but for most people hot means a significantly higher temperature on average than warm.
Actually, that was also my concern, as from a German background/sense of word order, "te warm voor me" would be considered as a unit, and "in juli" could be placed before or after, depending on emphasis or context. Is the given word order of the dutch sentence in this exercise common or normal?
There are several ways to say this: 1. Het is te warm in juli voor mij. 2. Het is in juli te warm voor mij. 3. In juli is het te warm voor mij. 4. Voor mij is het in juli te warm. 5. Het is te warm voor mij in juli. Now that I write this, I see the differences. Number 3 emphasizes the month, number 4 the fact that it applies to me. Number 2 and 5 are neutral. Number 1 -Duo's sentence - is also neutral but the least common order.