As I see it, an indoor level is one where you have no possible way of getting outside the level in any normal means. Outdoor levels are where you can normally get outside the level without the use of invisible blocks. Indoor levels have ceilings and walls forming hallways. Outdoor levels have no roof and walls can often be several hundred feet away. Outdoor levels indirectly have a roof - the sky, but skies are normally passable. That's how I see the difference between indoor and outdoor levels.

As for the original post, after setting the GXL2DX8A.DLL setting for both the 2D and 3D views, in WED go to view > textured to show textures.