I remember I had kind of a similar issue flying via LGW on separate tickets (Aer Lingus coming in and easyJet departure from LGW). The staff at the airport stopped me from using the channel for connections, and I had to go landside. I recall the reason given was that easyJet did not pay for the facility (for connections).

Was surprised that a random OTA would sell this as a single ticket - or as something that appeared to be one. Strange!

Why did you not book directly with AirAsia?

It must be a couple of years since I flew to/from DMK. I can imagine it can get busy at immigration and check-in. Have not had major waiting times there though - then again, have only gone through the airport a few times. Thought the terminal is perfectly fine airside.