Is it possible to use 10.8 to read logs and alert on specific keywords?
APM will not search for a string into the log and alert it. What we can do it map specific type of errors, like 404, 400, 500 and show it into Traces view. Also you can define what error you want to see and take of the other to do not flood your view.
In deep thought, maybe create a custom PBD with the classes that May through the error that you are looking for and see If APM can show for you when it happens, create an alert over it and see what do you want do see.
APM goes likely into App code, we can map almost everting based in the App classes/methods.