Why do I need to add a hub to the Isolator to get my device working?

This is a rare case and we are working constantly on compatibility enhancements.
The reason why some customers need a hub after the Isolator is due to the fact that USB reset procedure and handshaking is really complicated. The Isolator does not act as a hub but rather as a cable (of course, without contact). Thus, it has to translate any behaviour of both the connected devices whether right or wrong in a very short time. Once transmission is locked, there is no further reason to expect any improvement by a hub. USB 2.0 High-Speed hub chips are 15+ years old designs and many revisions came along, millions of devices where sold and a lot of competition inevitably raised compatibility. Our implementation is a completely new design from scratch and probably has to go a similar way to reach perfect compatibility.

Update (2016-02-22): Since our latest enhancements to the handshaking procedure, we have reached a statistical compatibility of greater than 99%. For XMOS-based devices, see also here.