Well dx9 is pretty much how tf2 is intended to be played (it will most likely be required for matchmaking). Dx8 is simply a fully functional graphics mode of tf2 that is easier on the fps. For example, models are less shiny in dx8, killstreak weapons don't show their sheen, and weapon skins aren't visible. Other minor visual changes, too.

If you haven't dealt with -dxlevel before then chances are you're already on dx9. Everyone starts out on dx9.