Indeed, it was a good format. Video8 and Hi8 were excellent formats, better than VHS, and Digital8 built on that by being a reverse compatible DV variant. In my opinion, 8mm based tapes were superior to the analog home-recording formats (VHS, VHS-C, S-VHS-C) -- especially Hi8. And Digital8 tapes were often more robust than DV tapes.
Now, Sony made a lot of terrible formats -- MicroMV, MiniDisc, magneto optical drives, floppy disk cameras, etc.
As far as sound support on Digital8, I don't really know, and it probably differs from Sony camera to Sony camera, if it exists at all. Sony has a bad habit of making things on paper only.
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