I have 8 hr layover at Xian Airport arriving about 7am.

Since you will have 8h layover, you are eligible for 24h visa-free transit. Just apply for a stay permit at the immigration counter and you will be allowed to leave the airport for a short trip.

Eight hours can be fine. U can take shuttle bus to downtown (Xishaomen Line is suggested) and transfer to a taxi to City Wall for fun, then wander around the Muslim Quarter. Remember to get back to airport 1.5-2h in advance.