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I created a Shapefile from Google Earth (kmz) consisting of a set of points which I had used as a layer for Heatmap analysis.

I opened the kmz file in QGIS and utilized the heatmap plug-in and it has 8 layer units as the default radius.

Can anybody enlighten me what does this 8 layer units mean?

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The documentation says

Radius: Is used to specify the heatmap search radius (or kernel bandwidth) in meters or map units. The radius specifies the distance around a point at which the influence of the point will be felt. Larger values result in greater smoothing, but smaller values may show finer details and variation in point density.

So if your layer has a projection system in meters, it means the radius of influence around each point will be 8 meters. If it is in feet, the radius of influence will be 8 feet... and if the dataset is not projected but it rather in lat-long, it will be 8 degrees - which is huge.

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