Yay! What a sensible decision!

I'd say don't go for a mountain bike, unless you're planning to also go off-roading on it in a big way. The knobby tires and suspension will slow you way down (although you could put slicks on it and lock out the suspension... it will still be heavy). Being slow isn't much fun; you get way hotter, and go slower, and interacting with faster traffic becomes that much more challenging.

A cyclocross bike can be both rugged and fast, and makes a great city bike. A road/touring bike can also work out just fine, especially with some wider tires (at least 28x700C would be my recommendation). Hybrid and fitness bikes also make nice rugged city bikes, and can have a more upright seating position and wider range of gearing than those other styles, which you may find is more comfortable and better suited to steeper hills/slower speeds.

Pannier is a great idea to keep your back cool. I'd also highly recommend fenders, a helmet mirror, and at least one water bottle and cage for hot days. 7-8mi could be walked if you have a mechanical issue, but at minimun, a tire patch kit/spare tube, levers, and means of inflation would also be a good thing to keep on you at all times. Practice changing your tube before you find yourself roadside racing the clock with a flat. Alternatively, I think there are some 'goo' products that seal small punctures as they happen. Your LBS should be able to help you out with all the accesories. I like having a floor pump at home so that keeping my tires inflated is more convenient.

7-8mi is do-able for a new commuter, but give yourself lots of time at first, and try doing a couple similar (or shorter) rides on the weekends to try it out. You can start working on your fitness right away by doing a little walking/jogging a few times a week (even 20-30 minutes at a slow pace), and that will help make the transition to biking even smooother. It might also help if for the first couple weeks you only bike commute 2 or 3 times a week, or park the car at the halfway point for the day. Your first trip in might be great, but on the trip home your muscles could be pooched, and it will feel really hard. Then, the next day, they could be stiff and sore, and your butt will definitely be REALLY sore (although it won't hurt until you get on the bike, will get better in a few minutes, and will eventually not hurt at all... that takes about a week). Your body will adapt quickly, and then you can let the good times roll! 7-8 mi is a nice distance to bike. If you stick with it, you're guaranteed to be fitter and stronger. Eventually, you can probably expect to do the trip in about 30 minutes or less, depending on how often you have to stop.