Another picture, this one with my prototype bus terminator, which uses a 1K resistor to 5V and a 680 ohm resistor to ground for each line:
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I think it cleaned up MEMR, but it made D0 look a little bit uglier. The 1K/680 resistor network will pull any high-impedance signal to ~ 2V, so that's why we see D0 spending a lot of time at the halfway point.
I would think we could use the Lotech memory card, since it's SRAM based, just like the Xi 8088. It could be the reason why your traditional memory card isn't working is that we're missing some of the DRAM refresh logic. I'm not really sure, I don't have much experience with dynamic RAM, only SRAM. The LoTech card would be a good thing to try. It's possible we could also design a small piggyback board for the Xi 8088 that put the SRAM data lines behind a buffer.
As far as the CP/M coprocessor, it's a "UniDOS coprocessor card". It has a Z80, some RAM, and about a half dozen logic chips on it. It comes with software that loads a CP/M program into the RAM and then starts executing it, sending console IO, file IO, and such to the PC's BIOS. It's pretty cool.