When block mining no longer rewards BTC, miners will have to lean on transaction fees to justify mining for profit. When this happens will the bitcoin protocol continue to vary the difficulty of mining such that a block is expected to be found every 10 minutes, or will difficulty drop to favor rapid block creation and rewarding of relatively smaller transaction fees?
Block rewards will never end. That what transaction fees are for. Difficulty adjusts to the amount of resources that are processing transactions so that they average 1 every 10 minutes.