Is sitting on a newspaper that contains the word "Allah" considered a desecration, even if one is not sitting directly on the spot where the name of Allah the Almighty is located? Is wrapping vegetables and fruits with newspapers that bear the word "Allah" considered a desecration? And how can one distinguish between what constitutes desecration and what does not?

It is not permissible to sit on anything that contains a name of Allah, or a name of one of His prophets, or anything that is held sacred by Sharia, even if the sitting is indirect. This is because it diminishes the reverence due to Allah's sacred symbols. Similarly, it is not permissible to use these papers for wrapping food or for any other purpose that involves their desecration. Disrespect includes throwing them on the ground or in the trash. Showing reverence includes placing them in a respectful place, or burning or burying them when they are no longer needed.