Howdy TS Martin:
The stock OEM engine for a 1968 Mustang is either a 170 or a 200 ci. The correct casting code for a '68 Mustangs will likely be a C6, or C8. Is this the original engine? IF so, recheck the casting marks. Sometimes they're hard to read. The D8DE code is a 1978. "D" represents the decade of the seventies, "8" represents the year, D8 = 1978.
The serial number is the VIN # and it is posted on a tag on the driver's side door frame.
The six cylinder engine options for the 1978 model year were a 170, id by three freeze plugs under the exhaust manifold, a 200, (Most likely) id by five freeze plugs under the exhaust, or a 250, id by 4 bolts holding the water pump to the block and a starter mounted below the oil pan gasket line.
Adios, David