the 65c22 I have has a totem pole output configuration whereas the 65c51 has an open drain output.
So it seems you have a W65C22S?
The datasheet requires the diode to be "forward biased when IRQB is low": this means the cathode must be on the 65C22 side.
Explanation (see attached picture):
Case HH:
When the IRQB output of the 65C22 is at High level, and nothing else is pulling the IRQB input line low, both sides of the the diode will be at Vcc: the cathode thanks to M2 conducting, the anode due to the pull-up resistor R. No current will flow through the diode.
The IRQB line is High.
Case HL:
When the IRQB output of the 65C22 is at High level, and another peripheral is pulling the IRQB input line low, the cathode will be at Vcc (M2 on) while the anode will be at about 0V. The diode is reverse polarized and no current will flow.
The IRQB line is Low.
Case LL:
IRQB out at Low level: M1 is conducting, and another peripheral is pulling the IRQB line low. As for the HH case, both sides of the diode are at the same potential and no current will flow.
The IRQB line is Low.
Case LH:
IRQB output is Low: M1 is conducting, and nothing else is pulling the IRQB input line low. The cathode is now at 0 V, and the anode is connected to Vcc through the pull-up resistor: the diode is now forward polarized, and a current equal to (Vcc - Vdrop)/R will flow through it.
The IRQB line is now at Vdrop potential, if that is low enough (Shottky diodes are usually better in this respect than regular ones) it will be interpreted as a Low level.
A Shottky diode usually has got a lower voltage drop than a regular one, but as rstofer says the signal might be marginal.
The datasheet is slight confusing, as it report in the same cell both Vss+0.4 and Vdd x 0.3. The latter value would be much more lenient.
@rstofer: thanks for interpreting the 'B', it was clearly on all active Low signals, but I was really puzzled about what it could stand for!