Consider an inertial frame of reference, $s$, (henceforth coordinates in this system will be small letters), and a frame $S$ rotating coaxially ($z$-axis) with respect to this frame (all coordinates in big letters), with constant angular velocity $\omega$.
Now consider a particle with position $\mathbf{x}$ in $s$, so that its coordinate in $S$ can be written as $\mathbf{X} = T(\theta)\mathbf{x}$, where $T(\theta)$ is the appropriate rotation/transformation matrix for angle $\theta$. (Note: Consider motion in $s$ in only plane $xy$, and $z$ axis is common, so motion in $S$ is in plane $XY$).
So $\mathbf{\dot{X}} = T(\theta) \mathbf{\dot{x}} + \omega\dfrac{dT}{d\theta}\mathbf{x} $.
But any vector in $s$ must satisfy that its coordinates will have to transform by the $T(\theta)$ transformation rule (to qualify as a vector).
By that logic, velocity in $S$, $\mathbf{V}$ must be such that $\mathbf{V} = T(\theta)\mathbf{\dot{x}}$, as $\mathbf{\dot{x}}$ is velocity is $s$. This must imply that $\mathbf{\dot{X}}$ is not the velocity in the $S$ frame, as it has an extra term as shown above.
What is going wrong here?