Enter the passcode you use to unlock your iPhone asking for 6 digit passcode when I use 8 digit passcode

The passcode it is asking for does not have to be the current passcode. it can be the passcode that was used at the time you last used end to end encryption

Some more info on end to end encryption here:

iCloud security overview - Apple Support

Do you have iCloud keychain turned on on your iPhone at the moment? If not that is the likely reason why it is not asking for your current passcode. You can reset the encrypted data in iCloud during the sign in, it will only affect end to end encrypted data.

GracieEm wrote:

Thanks for you reply Androish.

I do have iCloud keychain turned on on my iPhone. I would go for reseting the encrypted data in iCloud, but I'm hesitant to lose all my saved passwords. Is there anything else I can do. I don't remember any other passcode that wasn't 8 digits.

See if there is anything here:

iCloud requires iPhone passcode to unlock - Apple Community

Use a passcode with your iPhone, iPad, or iPod touch - Apple Support

Verification code - how to get one and sign in with two-factor authentication.   

GracieEm wrote:

Thanks.

I eventually went with reseting the encrypted data so I was able to eventually sign in. Currently haven't noticed any lost password yet. Fingers crossed.

Good computing GracieEm !