I'm not as certain that not using LVM is the answer, especially given the fact that Fedora 7 worked flawlessly. Not using LVM may infact resolve it, but perhaps this is an issue with the new kernel and should be reported as a bug. Did your F7 install use LVM?
One thing to try without going through a complete reinstall is to install the F7 kernel keeping the F8 system intact. This will also tell us if it is an issue with the F8 kernel. Some people may say this is goofy, but it worked for me when an F7 install would not boot, so I used the FC6 kernel and wallah, I was up and running.
If I remember correctly this is how I installed an older kernel on a non-bootable installation.
1) boot from rescue DVD/CD and use linux rescue at the prompt
2) pick language, keyboard, then it will ask if you want to find any fedora installations, click continue so it will mount it readwrite to /mnt/sysimage. If you have more than one Fedora installation on the drive make sure to pick your F8 install.
3) When you get to the shell prompt, chroot /mnt/sysimage
4) rpm -ivh --oldpackage http://download.fedora.redhat.com/pu...1.fc7.i686.rpm
(I made some assumptions here about your architecture i386 and system i686, change if necessary)
Note that this will not replace the current F8 kernel, just add another older kernel. kernel package processing works a little different than regular packages.