Step 1: Use Horizontal Strips:
Take the first-quadrant region. At height $y$, the condition $y\leq x^2$ gives $x\geq\sqrt y$, and $xy\leq8$ gives $x\leq\dfrac8y$. The strip has width $\dfrac8y-\sqrt y$.
Step 2: Find the Range of y:
The strip exists only when $\sqrt y\leq\dfrac8y$, i.e. $y^{3/2}\leq8$, i.e. $y\leq4$. With $y\geq1$, the heights run from 1 to 4.
Step 3: Integrate:
\[ A=\int_1^4\left(\frac8y-\sqrt y\right)dy=8\ln4-\frac23\left(4^{3/2}-1\right)=16\ln2-\frac{14}3 \]
This agrees with option (D).
Final Answer:
Option (D).
\[ \boxed{\text{(D) } 16\log2-\frac{14}{3}} \]