After reading around the net about the TXS0108E it seems that they have a low capacitance tolerance at high data rates so it might be an issue of too much capacitance on the signal lines on the dev board. I tried connecting an SPI SRAM chip on very short leads to the Raspberry Pi using a TXS0108E level converter and it worked fine so as long as I keep the traces short on the final PCB design hopefully everything should work ok.
Thanks for all of the help, now I just need to figure out all of the sampling code on the microcontroller and make it act as an SPI slave device.