Did he just hit an inside draw?

[bav]

B&M NL1/2, $200 max buyin. Hero has $650ish. Villain has $1500ish which he's accumulated by hitting almost anything he plays, but without playing terribly wildly.

Hero has J[img]/images/graemlins/spade.gif[/img]J[img]/images/graemlins/club.gif[/img] UTG and limps for $2. At least 60% of pots are being raised preflop to $10 to $15 so I want to let someone else raise it. A couple limpers, villain raises to $12 from LP and there are about 4 callers.

Flop (5 players, $43): J[img]/images/graemlins/heart.gif[/img] 8[img]/images/graemlins/club.gif[/img] 4[img]/images/graemlins/diamond.gif[/img]
It's checked to the villain who bets $25. Folded to the hero who raises $35 more to $60. Only villain calls.

Turn (2 players, $163): 6[img]/images/graemlins/spade.gif[/img]
Hero bets $200. Villain instantly all-in's.

Now what? Hero has almost $400 more. And what might our hero have done differently?