When you changed to another unit code, did you also change the corresponding switches to confirm that pair was working on the new code? If not, are 7 and 8 in the same room or on the same circuit?
Sometimes the switch that selects the house or unit code will become oxidized and make poor contact. In that case the module or wall switch may begin responding to a different code. Spinning the code wheels around a few times wipes off the oxidation, and restores normal operation.
If 7 and 8 are in the same room or on the same circuit, you may have a noise source or signal sucker interfering with the X10 signals. I wrote some troubleshooting guides that may help:
http://jvde.us/x10_troubleshooting.htmThe switch not responding to manual actuation is something different. Did you perhaps change to a different type of light bulb? If CFL or LED, have you checked the operation with a standard incandescent bulb?
Jeff