Is interception intended to be the preferred method when dealing with changing the behavior of an original method in Magento2 as observers was in magento1?
I don't think interception is intended to replace event observers.
The interceptors are just a way to process the input or output of a method.
I think it's more of a way to avoid class rewrites as much as possible.
With observers you can manipulate data in certain fixed points of a method, not the full method itself.
In my opinion, using observers when possible is still the best approach for customizing even in Magento 2.
Currently there is still the option to listen to specific events and I would suggest that the interceptors is just a replacement for rewrites. I would still use the events when there is one in place for your needs.
If you look at the current release some of the modules have
Interception is evolution of events. Its goal is to allow a developer to write his code without thinking about extension points.
With events you have to think about places where you do Mage::dispatchEvent() so that your module will be customizable.
Interception allows you not to think about this. You just write your business logic. Every method call is an event. So if you write your code in a proper object-oriented way, it will be fully customizable by design.
So yes, Interception replaces events in Magento 2. Not all events were removed because it's pretty big chunk of work that will not bring any value.