My 1998 INSTPK gets 'SLIGHTLY' dimmer with the headlamps in the OFF position and reacts to the dimmer with switch in any other position.

 

The dimmer knob has no effect on the dash lights when ign sw is on and headlight sw is off.... the dash lighting is not illuminated. The dimmer works normally with headlight switch in any "on" position.
The Canadian DRL setting has the low beam headlight running at 100% regarless of headlight switch setting. Low beam remains on even when high beam is selected.

 

This is interesting. One might expect full brightness during daylight (headlights off) operation.
I checked this in my darkened garage and found no lighting of the dash lights with ign sw on and headlight switched off.
I'm beginning to wonder whether a wire has broken off at the headlight switch stock module in the steering column. Forum posts elsewhere seem to identify this as a source of a number of issues. I'm just waiting to see if someone with 4.2 car that has Canadian DRL enabled chimes in with their experience of dash lights in the ign on/headlight off situation.

 

From what I have read the 1997 XK8 BCM is not the same as later models and it cannot be adjusted with the IDS? I also have found that you cannot even change out the BCM for a later model due to a number of sensors that are needed that are not available for the 1997.

 

I've fitted Hella LED daytime running lights to my XK8. They come with the relay and are easy to connect. I got the idea from another forum member's thread. They're really useful these days with all the bike lanes. I've already registered them on my vehicle registration document.