7.8 is an almost ideal pH. The pH scale goes from 1-14 (1 being Acidic and 13 being Basic.) Stomach acid is a 1 and Bleach is a 14 on this scale, to give you an idea.
The general range for aquatic life is 5-8.5. Some can live outside these limits, but for most pet fish this range is what you want to be in. i.e: Cichlids do better in higher pH's, around 8.0-8.4 is ideal for them.
7 is the neutral pH, and the generally accepted pH of water, but as you can see with your tank, it's not easy to keep the water at 7.
The pH you have is pretty near ideal for most tropical fish such as Live bearers. If you have Cichlid's, then 7.8 is low.
If you have 6.5 now I'd say that is pretty low, but ironically it would be good for German Blue Rams, which are also Cichlids as I recall (Though they're South American, rather than African.) I could be wrong about that tidbit though, as I don't keep Cichlids.
To be honest that pH change is very dangerous for your fish. It;s more dangerous to have a sudden change like that then to have them at a stable, but high pH their whole lives. I reccomend you remove the drift wood, or if you like it, either change your fish stock to suit the Ph or add a chemical - but I don't happily reccomend adding chemicals to up the pH. (The less chemicals in a tank the better.)
