Not sure where you got 8 bit from. WasapiLoopBack is in Float, 32 Bit. And no inbuilt conversion is available.
And as for most applications, you probably don´t want Float, and 16 bit, or 24 bit.
So this converts it from Float 32bit to 16bit. So there is no benefit in terms of quality, there is probably less quality, but that´s inaudible probably.
If it were in 8 bit, it would be extremely noisy. 16 bit sounds clean and the noise floor is far below what´s audible. 8 bit however has noise no matter what, the noise floor is so high up, that it´s impossible to have any sound audible without hearing the noise probably, at least in all normal scenarios.
And as for most applications, you probably don´t want Float, and 16 bit, or 24 bit.
So this converts it from Float 32bit to 16bit. So there is no benefit in terms of quality, there is probably less quality, but that´s inaudible probably.
If it were in 8 bit, it would be extremely noisy. 16 bit sounds clean and the noise floor is far below what´s audible. 8 bit however has noise no matter what, the noise floor is so high up, that it´s impossible to have any sound audible without hearing the noise probably, at least in all normal scenarios.