Yes you would need a hardware downgrade any CFW route you go. Once you pass 3.55 hardware is the only way to install a CFW with a NOR/NAND flasher like E3 or progskeet. Dongles are utterly useless now days and it is just a piece of history with no real value or use.
PS3 CECH-2501A [CFW] & CECH-3001 [OFW]/ PS2 SCPH-3901 & SCPH-7501/ PS1 SCPH-5501
Mod Cobra 4.46 v7.00 w/ E3 Flasher [CFW] & Cobra ODE 4.50 [OFW]/ Mod HDD-OSD [Phat] & Modbo 4.0 [Slim]/ Mod MM3
HDD 1tb [CFW] & 640gb [OFW]/ HDD 640gb & OPL v0.92 w/ 1.5tb SMB