The peasant-student coalition that last week invaded two foreign embassies in El Salvador, holding the ambassadors and their staffs hostage, has long sought an international spotlight for its demands for increased peasant and union rights in that country.

When military police in San Salvador yesterday broke up a demonstation in support of the embassy takeovers, killing at least eight persons and wounding scores more, that spotlight was assured.

Formed nearly four years ago when the country's two leading peasant unions joined forces with militant students and teachers' unions and a group of organized urban shanty-dwellers, the Popular Revolutionary Bloc quickly made its name locally among the dizzying array of groups that make up the broad opposition to El Salvador's rightist military government.

That opposition includes moderate political parties, most of which have been effectively cowed through the exile of their leaders and repression of attempts to organize.

On the far left of the opposition spectrum are two relatively small and one substantially larger Marxist guerrilla groups, whose tactics center on the kidnaping for ransom of foreign businessmen.

But from the point of view of the government and the wealthy landed and industrial class that supports it, by far the most dangerous opposition comes from the vast majority of peasants who provide the day labor to support the country's near-feudal economic system.

A series of military governments since the early 1930s, when a peasant revolt cost more than 30,000 lives, has thwarted peasant attempts to organize. Both of the two large peasant groups that form the bulk of the Popular Revolutionary Bloc's membership, estimated at approximately 20,000, and the Bloc itself, are illegal under Salvadoran law.

The rationale for the government's prohibition is that the peasant unions are closely allied with the various guerrillar groups, a charge that the Revolutionary Bloc denies, although informed sources say some BPR members have ties to the Popular Liberation Forces, El Salvador's largest guerrilla faction.

While their aims for land reform and social programs are undeniably leftist, the peasants say they are independent. Much of their support comes from the liberal wing of El Salvador's Catholic Church, which has been sharply divided over the issue of human rights in general and the peasant unions in particular.

Rather than the kidnapings and terrorist operations favored by the guerrillas, the Revolutionary Bloc has concentrated on organizing nonviolent protests and civil disobedience, including the occupation of government buildings, foreign embassies and branches of international organizations in El Salvador.

"It's not our character to demand money." Bloc official Ricardo Lopez, 24, said in a recent interview in San Salvador. "That's something for the armed guerrillas, not for a mass movement."

While the current Salvadorian government of Gen. Humberto Romero, inaugurated in July, 1977, initially adopted a softer attitude toward the Bloc than did the previous government, tensions heightened in the fall of that year when the organization demonstrated in support of striking unions in San Salvador.

In November, 1977, the group's members occupied the Labor Ministry. Several days later, the government responded by promulgating the Law for the Guarantee and Defense of Public Order, a draconian measure essentially giving the military carte blanche powers against anyone it deemed troublesome.

In February 1978, the Bloc peasant unions submitted a written proposal to the government's Agricultural and Livestock Development Bank asking for lower interest on farm loans and decreased prices for fertilizer and insecticide. The government promised them killing at least 18.

When that day arrived, several hundred Bloc members marched to the bank and found it closed. They began a demonstration downtown that was halted when military police fired on them, killing at least four.

Later in March, at least 15 peasants were killed in a confrontation in the small town of San Pedro Perulapan between the peasant unions and members of ORDEN, an 80,000-strong government spy and paramilitary network of civilians recruited throughout the country.

While the government charged the peasants with proking the incident in which the entire town was surrounded and occupied by troops, both the Revolutionary Bloc and the archbishop of San Salvador, who conducted his own investigation, called it a massacre initiated by the government.

The Revolutionary Bloc, protested the San Pedro killings on April 11, 1978, by occupying the embassies of Venezuela, Panama, Costa Rica and Switzerland. Surprisingly, those governments chose not to request military assistance in routing the demonstrators and, at least in the case of Venezuela, chose to consider them as requesting political asylum.

When the Revolutionary Bloc occupied the embassies of Costa Rica and France Friday, it was to protest the arrest of five coalition leaders including Bloc Secretary General Facundo Guardado, who disappeared during the last week in April.

While both the government and embassy spokesmen have said that the Bloc members within the embassies are armed, coalition officals have insisted they are not. The demonstrators have demanded the release of the five men, but the government has refused to negotiate and has said that it has only two of the missing officials, both of whom it says are charged with common crimes.

The Revolutionary Bloc has issued no ultimatums and made no threats against the lives of its hostages should its demands be unmet. Leaders appeared somewhat encouraged yesterday by the supportive strike of 15 labor unions on behalf of their cause.

Yesterday's demonstration was also intended as a show of support for the Popular Revolutionary Bloc. CAPTION: Picture 1, French Ambassador Michel Dondenne, right, and another hostage pull a bag of food through a window of the French Embassy in San Salvador. UPI; Picture 2, Salvadoran policeman watches demonstrators near cathedral beford the shooting. UPI