If the hardware does not work in the first place, then there is only so much a software can do about it. But here we are talking about a system which works and gets improved.
Tesla is very explicit about the limitations of their current system. So the autopilot accident seems to be mostly about the owner not really understanding what the current autopilot can do and what not - after all, in the car it is just called "autosteer".
There is also already talk about the autopilot 2.0. This consists of augmented hardware, e.g. 3 different front-facing cameras. Only with that hardware Tesla is trying to reach level 3 or 4. The 8.0 update is about enhancing the quality of the existing autopilot but not about reaching new levels of automatic driving.