The size of the panel icon of Xfce4-weather-plugin 0.7.3 in Xfce 4.8 is far too small. It can hardly be recognized. In Xfce 4.6 it was much bigger and a lot better to see. It would be nice, if the panel icon could be scaled up.
After a reboot and logging into Xfce again the panel icon was extremely big and the temperature wasn't shown in the panel. When I removed this plugin and added it again to the panel the icon was too small again.
You probably used a git snapshot, should be fixed now.