I found this article on the internet on how to update from Fedora 7 to Fedora 8 without using a DVD/CD. It worked like a charm! I tried it for FC6 -> F7 and it worked great too!
http://www.ioncannon.net/system-administration/133/upgrading-from-fedora-7-to-fedora-8-with-yum/
The key is running "yum update", and installing these two packages:
rpm -Uhv http://mirror.anl.gov/pub/fedora/linux/releases/8/Fedora/i386/os/Packages/fedora-release-8-3.noarch.rpm http://mirror.anl.gov/pub/fedora/linux/releases/8/Fedora/i386/os/Packages/fedora-release-notes-8.0.0-3.noarch.rpm
Then running yum update again. After a reboot you should be set.