Sorry for the confusion. I am trying to convert the logic signal to 12V and isolating it from the arduino would be a benefit. This will got to 2 separate LED strings that have their own 5V supply. Here the data would be shifted back to 5V logic. The environment is electrically abusive. My concern is that running the arduino output directly out to the LEDs is exposing the 5V supply to noise. The LEDs can skip a refresh or 2 and not cause a issue.
Much researching last night leads me to believe that the 3904 and 3906 are simply not fast enough.
More concerning is that it doesn't look like the Atmel can get its output pins to get much higher than 2V at these speeds.
Using these leds String & Fairy Lights for Sale - eBay the 60 per meter version and each string has 83 LEDs.
I was stressed and exhaust when I posted late last night, hopefully this is much clearer.