(Edit: I've added in more details below.)
Nice question! The condition that $\sqrt{n}$ has a repeating digit of $d$ that repeats $k$ times after the decimal point is equivalent to the condition that
$$\sqrt{n} - m - \frac{d}{9} \frac{10^k - 1}{10^k}$$
is positive but less than $10^{-k}$, where $m = \lfloor \sqrt{n} \rfloor$ is the integer part. To get a rough idea of how this condition works we are going to simplify and replace that third term with $\frac{d}{9}$. So, let's write
$$\sqrt{n} = m + \frac{d}{9} + \varepsilon$$
where $\varepsilon$ is small. Squaring this gives
$$n = \left( m + \frac{d}{9} \right)^2 + 2 \left( m + \frac{d}{9} \right) \varepsilon + \varepsilon^2.$$
Since $\varepsilon$ is small this means that $n$ is close to $\left( m + \frac{d}{9} \right)^2$, so $\left( m + \frac{d}{9} \right)^2$ has to be close to an integer. For example, taking $n = 5168$ we have $m = 71, d = 8$ and
$$\left( m + \frac{d}{9} \right)^2 = \left( 71 + \frac{8}{9} \right)^2 = 5168.0\color{red}{123 \dots }.$$
It's a little easier to see why this happens if we rewrite it as
$$\left( 72 - \frac{1}{9} \right)^2 = 72^2 - 12 + \frac{1}{81}$$
where $\frac{1}{81} = 0.0123 \dots $. Note that this calculation works out nicely because $72$ is divisible by $9$. The same thing happens with your example of $n = 492648, m = 701$, which corresponds to
$$\left( 701 + \frac{8}{9} \right)^2 = \left( 702 - \frac{1}{9} \right)^2 = 702^2 - 2 \cdot 78 + \frac{1}{81}.$$
So we see that taking $d = 8$ and $m + 1$ to be divisible by $9$ produces a value of $\left( m + \frac{d}{9} \right)^2$ which is exactly $\frac{1}{81}$ larger than an integer. Since the distance to the closest integer has to be a multiple of $\frac{1}{81}$, this is the closest we can get, and using any other digit would be worse (or the same); for example if we tried $d = 7$ we'd get something like
$$\left( 72 - \frac{2}{9} \right)^2 = 72^2 - 24 + \frac{4}{81}$$
which is $4$ times worse!
The example $n = 43, d = 5$ actually behaves a little differently from these larger examples because $m + 1$ isn't divisible by $9$. Here the relevant calculation is instead
$$\left( 6 + \frac{5}{9} \right)^2 = 36 + \frac{20}{3} + \frac{25}{81} = 42 - \frac{2}{81}.$$
So here the middle term is not an integer but it partially cancels nicely with the last term to get a distance of $\frac{2}{81}$ to the nearest integer, which is pretty good but still not as good as $\frac{1}{81}$.
By working a little harder we can explicitly construct minimal examples with more repeating $8$s. So let's assume we're in the nice case above, $d = 8$ and $m + 1$ is divisible by $9$, so we can write $m + 1 = 9 \ell$. It turns out that to get accurate answers here we have to undo the simplification we did above and go back to considering $\frac{d}{9} \frac{10^k - 1}{10^k} = \frac{d}{9} - \frac{d}{9 \cdot 10^k}$. So, we are now considering
$$\begin{align*} n &= \left( 9 \ell - \frac{1}{9} - \frac{8}{9 \cdot 10^k} + \varepsilon \right)^2 \\
&\approx \left( 9 \ell - \frac{1}{9} \right)^2 - 2 \left( 9 \ell - \frac{1}{9} \right) \left( \frac{8}{9 \cdot 10^k} - \varepsilon \right) \end{align*}$$
where we've grouped the small terms together and ignored their square (which is really small). As we saw above, $\left( 9 \ell - \frac{1}{9} \right)^2 = n + \frac{1}{81}$, so subtracting gives
$$\frac{8}{9 \cdot 10^k} - \varepsilon \approx \frac{1}{162 \left( 9 \ell - \frac{1}{9} \right)}.$$
To find the smallest value of $\ell$ such that we get $k$ repeating $8$s we want to find the smallest value of $\ell$ such that $0 < \varepsilon < 10^{-k}$. For the smallest value of $\ell$ it turns out that $\varepsilon$ is very small, so we can compute $\ell$ by plugging in $\varepsilon = 0$ and solving for $\ell$, then rounding up, which gives (after some algebra)
$$\boxed{ \ell = \left\lceil \frac{10^k}{8 \cdot 162} + \frac{1}{81} \right\rceil }.$$
(That $\frac{1}{81}$ bit probably doesn't matter, at least for small $k$, but let's keep it to be safe.) Let's test this out: plugging in $k = 4$ gives $\ell = 8$, which reproduces $m = 71, n = 5168$. Plugging in $k = 5$ gives $\ell = 78$, which reproduces $m = 701, n = 492648$.
Now to find the next term! Plugging in $k = 6$ gives $\ell = 772$, which produces the new $m = 6947, n = 48273160$, with square root
$$\boxed{ \sqrt{n} = 6947.\color{red}{888888}000 \dots }.$$
Edit: The first half of the discussion above was incomplete; we didn't really rule out the possibility that other repeating digits could also occur first, and in particular we didn't rule out the possibility of $d = 1$ even though $\left( 9 \ell + \frac{1}{9} \right)^2$ is also exactly $\frac{1}{81}$ larger than an integer. Fortunately the more precise second half of the discussion gives us the tools to understand why $d = 1$ does not occur earlier than $d = 8$ (and the other digits should be similar). If we take $d = 1, m = 9 \ell$ then we are now considering
$$\begin{align*} n &= \left( 9 \ell + \frac{1}{9} - \frac{1}{9 \cdot 10^k} + \varepsilon \right)^2 \\
&\approx \left( 9 \ell + \frac{1}{9} \right)^2 - 2 \left( 9 \ell + \frac{1}{9} \right) \left( \frac{1}{9 \cdot 10^k} - \varepsilon \right) \end{align*}$$
and chasing through the same calculations as above produces
$$\ell = \left\lceil \frac{10^k}{162} - \frac{1}{81} \right\rceil.$$
So we can see what's gone wrong: the value of $\ell$ in this case is about $8$ times larger than when $d = 8$. For example taking $k = 4$ gives $\ell = 62$ which corresponds to $m = 558, n = 311488$ with square root
$$\sqrt{311488} = 558.\color{red}{1111}000 \dots.$$
Probably there's a better way of doing this calculation that works uniformly in the digit $d$ and explains more clearly where this factor of $8$ comes from, right now it's not quite intuitive to me yet.
11111: 1060
,22222: 1060
,44444: 1060
,88888: 1060
,66666: 1059
,77777: 1059
,55555: 933
,33333: 436
,99999: 0
$\endgroup$