I don't think any variance from strict sex segregation should be happening, but that doesn't mean that I don't see it's not simple for the prison authorities to work out what to do with trans inmates.
It's not simple, but they are just another group of potentially vulnerable prisoners. I assume that the prison service has guidelines for ensuring the safety of various other groups of vulnerable prisoners, within the prisons designed for each sex. They just need to be extended to cover prisoners who 'identify as' a different sex or non-binary.
The problem has arisen because of the legal fiction that was created with the GRA (and possibly before) that someone who wanted to 'live as' the opposite sex could actually be legally recognised as such. Biological reality has to be the overriding factor here, not the fictions that were put in place to help the experience of people whose lives were being made difficult because of their non-compliance with gendered expectations.