Welcome to the forum.
I have used the DivX CODEC, plus the DivX Pro Encoder for years, with zero issues, until the most recent update of DivX with both its CODEC and its player. Did not update the DivX Pro Encoder.
First, these problems have not affected PrE 4.0, running on XP-Pro SP3, so there ARE many differences to your setup. With those differences, I am not at all sure that my observations will apply to your installation and your system.
The only problem that I encountered was that the DivX player seized the File Type Associations for all AVI's, so that Dbl-clicking on any, would always Open them in the DivX player. The new one is filled with ads for all sorts of things, and reminds me of the old RealPlayer from years ago. Also, those ad often lead to a dead-end, from which the only recourse is to buy whatever the ad features, or go to Task Manager and Kill the process - really, really bad move DivX. All it took was going to Control Panel>Folder Options>File Type and changing the AVI associations back to my desired player, MediaPlayer Classic HC. Fixed.
That was my only issue with any version of the DivX CODEC, or the DivX player. Still, I made note of it.
That does not mean that on your system, and with PrE 8, something in there might not have broken.
I would check the file associations in Control Panel, and reset any, that DivX Player might have changed, then test.
While you are at it, also update both your video driver and your audio driver, from their mfgr. Web site.
Good luck, and maybe others will have tips or suggestions.
If you were planning on sharing to DivX format from Premiere Elements, don't. You'll end up with corrupted looking video here and there.
I have never encountered that at all, using either PrE, or PrPro and the DivX CODEC.
Now, and though it should work the same way, I have yet to get the Xvid CODEC to Export - the NLE always crashes.
Not sure why you are having quality issues with DivX out of PrE.
Yep, always crash with Xvid in Premiere Elements.
I've never had a flawless export to DivX -- standard definition or high definition -- with any version of Premiere Elements. I've managed to export to DivX with small frame sizes, but that isn't what I wanted.
My bad luck with Xvid has been for both PrE and PrPro - always a crash. I know that it should not be this way, as Xvid is but the open source version of DivX, however something has to be different, and neither version of Premiere likes it, and can work with it.
I'll have to test again with DivX, as I cannot recall what Frame Sizes I used, but would think that they were 720 x 480. Last time that I used it, was for a test of file sizes in the PrPro forum. Still, I will explore, paying special attention to file sizes. For me, the material was no larger than DV, so cannot comment on any flavor of HD Export.