74HC238 (Decoder) - Will it use VCC to power channels?
The outputs are directly sourced by Vdd and sinked to GND. That's a basic function of logic gates. But be careful, some chips have open-collector/open-drain outputs which means they can only sink the output, not source it. Usually, this comes with more sink current capability and/or with a >>Vdd voltage compatibility at the output. Look at the datasheet. Check the supported currents if you want to drive LEDs. Output current and sum current on Vdd/GND.

It will work with a 74HC238. However, the usual way to do this is using an inverting decoder as the 74HC138, and tie the LEDs (plus current-limiting resistor) between the outputs and Vdd. Why? Because most multi-LED arrangements are common-anode, which means they have a shared pin for the anode connection.