Will a Free Software Society ever become a reality?
Your questions asks:


  A society where all the players abide by the above FSF principles


It won't ever happen for all players. As a counter-example, consider an engineer who invents software that can predict when a jet engine needs maintenance. It's worth millions to the airlines, who will happily pay him for the software. He has no incentive at all to release this software as open-source. The same principle applies to all sorts of specialist software.

In contrast, open-source works well for common building blocks. For example, there are all sorts of companies who need an operating system for their product - cloud providers, home network kit, super computing, all sorts. While they could build their own, it is much more efficient to have a common pool, like the Linux kernel. This environment means that companies can put paid engineers on open-source projects, and still run a profitable business.