It appears that XenServer does not support TRIM / Discard on SR's provisioned via iSCSI.
Mounting the same iSCSI LVM volume on a normal Debian / Centos server works as expected however when mounting it and attaching via XenServer it appears that the discard ioctl is being masked:
[ 67.536131] EXT4-fs (xvdb1): mounting with "discard" option, but the device does not support discard
[ 67.536135] EXT4-fs (xvdb1): mounted filesystem with ordered data mode. Opts: discard
I noticed that the dom0's don't have issue_discards=1 set in their /etc/lvm/lvm.conf so I tried setting that and rebooting the dom0, but it did not fix the issue.
I noticed that someone else mentioned this problem to Tim during the Alpha but I don't think it got anywhere: http://xenserver.org/discuss-virtualization/virtualization-blog/entry/xenserver-creedence-tech-preview-and-creedence-alpha.html