This question arises not infrequently in the "domotics" context.
An Arduino is a "smart" device which you can program to make decisions.
The smart way to utilise it is to program it to do whatever you need it to.
In this instance, what makes the most sense is to use the Arduino to control the relays which switch the lights. What they cause the lights to do may be as a result of Bluetooth commands. If you wish to control them by wall switches, then you connect those switches to the Arduino and decide - in code - how to reconcile remote control commands with wall switch commands.
The most straightforward way of doing this is to use momentary buttons which toggle the lights on and off with each press, then you do not have to be concerned whether up or down is "on". If the lights are in plain sight, you do not need an indicator on the switch to tell you whether they are on.
My preference would in fact be to use touch sensors instead of buttons using the TTP223 modules.
thank you for the very valuable information, that is the route i think i am going to go although i will use normal on off switches (purely as i have a massive stock of them )
how can i link these to the arduino as i am basically out of digtal pins on the device (i have 12 and 13 left after the bluetooth tx and rx and the 8 relay outputs) - i could possibly change to a Arduino DUE but the power draw off that is more than i would like for 24/7 power usage.
i admit i am not greatly clever with microcontrollers so i am certain this is something simple to deal with