In various questions in this platform, I have seen people classifying Shudras as untouchables whereas in reality, Shudras are a caste within the pale of the Varnâshrama system but untouchables(antyajas) are considered to be outside the pale of Varnâshrama. Then why this confusion persists ?
You have to show some examples where you have seen the confusion for us to exactly understand your point.
Although Shudras and mixed castes (Antyajas - those who are born out forbidden marriages) are different, a Shudra's touch is also regarded as "sullying" just like an Antyaja's touch is.
Manu Smriti 3.241. A boar makes (the rite) useless by inhaling the smell (of the offerings), a cock by the air of his wings, a dog by throwing his eye (on them), a low-caste man by touching (them)
5.104. Let him not allow a dead Brahmana to be carried out by a Sudra, while men of the same caste are at hand; for that burnt-offering which is defiled by a Sudra’s touch is detrimental to (the deceased’s passage to) heaven.
So, this might be the reason you are looking for.
I call it "misguided perception". The caste system was originally designed for social structure and division of responsibility, thought to be one of the efficient ways to run the society smoothly. Talking about the birth of each caste being sourced from different organs/body of the creator is, I consider, a pictorial representation of duties. It was never designed to create discrimination. Would you say torso is more important that head or vice versa?
But the way head rules your actions (pun intended), so did the few varnas thought their responsibilities are of higher importance, automatically leading to degradation of remaining varnas. Once we have discrimination, exploitation starts and hence we have concept like untouchables. Varna system no way supports ideas like untouchables but it is the flatted importance of few varnas to consider remaining varnas below them to the extent of considering them untouchables.
Terms like "untouchable" should be eradicated and as for the future of caste system, I would suggest you to read this - Sadhguru on casts system