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I am an Indian citizen, and plan to drive from Washington DC/Virginia to Toronto. I have a B1-B2 visa for USA as well as Canada (tourist visa). How long will it take me by road, accounting for customs and immigration at the border?

Will we face any obstacles while crossing the border, with regards to driving a hired car, but with an Indian license?

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According to Google maps, the drive time is just under nine hours, but you probably knew that already. The variables, of course, are traffic congestion and border crossing times.

The most direct routes avoid large cities, so the biggest risks for significant traffic congestion are in leaving Washington and entering Toronto. The impact of any congestion also depends on your precise destination and point of origin, too; for example, a point in the suburbs will be easier to reach than the city center.

As to border crossing times, my experience crossing the land border has been with points that are, I suspect, far less busy than the one you will use. Fortunately, you can get information about current border crossing times on the web:

https://bwt.cbp.gov/
http://www.cbsa-asfc.gc.ca/bwt-taf/menu-eng.html

You should also apply some common sense in estimating the likelihood of being selected for more intensive screening. If you have many passengers, for example, or a good deal of luggage, it might take longer for you to cross the border. When you return to the US, I understand, you will need to go into the office to be fingerprinted again, but I have never experienced it first hand as I have never done this with a B visa holder. If you want to be very safe, for example if you are taking a flight, you should probably allow a couple of hours to cross the border. On the other hand, the actual time required will most likely be no more than 15 minutes.

When you reserve your car, and when you rent it, ask whether you can drive the car into Canada. The answer will be "yes," and you can then ask whether there are any special procedures or charges to do so. I believe the answer will be "no."

That is, unless you're planning to leave the car in Canada and return some other way. One way rentals are in general expensive, and international one way rentals may not be possible.

As to your driver's license, to be safe, you will want to get an international driving permit, but if your license is in English, that might not be necessary. To be certain of the requirements, you'll need to check with each state and province you'll be driving in, to see whether a foreign license is acceptable on its own.

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