Here is the quote from the data sheet

"When functioning as a timer, the TLx register is incremented
every machine cycle. Thus, one can think of it as counting
machine cycles. Because a machine cycle on a single-cycle core
consists of one core clock period, the maximum count rate is
the core clock frequency.

When functioning as a counter, the TLx register is incremented
by a 1-to-0 transition at its corresponding external input pin:
T0, T1, or T2. When the samples show a high in one cycle and a
low in the next cycle, the count is incremented. Because it takes
two machine cycles (two core clock periods) to recognize a
1-to-0 transition, the maximum count rate is half the core clock
frequency."

Analog Devices ADUC845/7/8 Data Sheet, pg. 75

I'll do some experimental work with this and see what the results are. Thank you for the help, I'll let you know what the results are.