To answer your last question first, no.
Both radios use digital proportional servo control. As you turn the wheel on the radio, the steering servo responds proportionally to how much and how fast you turn the wheel. The digital part means there are steps between each point the servo stops. This means that every certain number of degrees you turn the wheel, the servo turns that number of degrees. The steps are so small you don't notice them. So technically both radios are digital.
Your first radio uses Amplitude Modulation (AM). The M8 uses Frequency Modulation (FM). AM is cheaper to make. FM is less susceptible to interference.
Digital servos are better than analog servos because they respond faster and have more holding power. Since you're using the same servo as before you probably won't see a big difference, unless the M8 receiver has a faster response time.