Will technology one day progress to the point where there will not be a need to distinguish between hardware and software meaning that no difference would be perceived between the 2 types of interface?
No, hardware is of necessity a physical mechanism and software is procedural information. The same software can run on very different hardware, as long as it interprets it the same way producing the same physical effect will have the same result. But hardware without software will do nothing (unless the hardware is fixed single purpose hardware that needs no software).