I attempted the view change on a single player track and rebooted the game to make sure control changes had registered (I checked that the settings were still in place). I shouldn't have said I had the same problem as the OP because I see now his mouse axis were not working but the mouse views (and steering) work for me. Am I missing something?
I seem to have the same problem. I have the view setting set to axis (it works correctly if set to mouse or steer). The heading/ pitch/ yaw are set to use axis and those same axis work when assigned to other functions. I'm using "Live for Speed S2 0.5V ALPHA", according to the readme. I'll try seeing if a fresh install will help.