I dropped my napkin in a restaurant the other day and picked it up myself. My mother-in-law informed me that it was improper etiquette to pick up a dropped napkin and that the waiter was supposed to do that for me. Is she right? I have some other napkin questions: where do you put the napkin when you are finished with dinner? Can you spit out food into the napkin?
If you were in a very formal restaurant where waiters are hovering nearby to tend to your every need, then let the waiter pick up the napkin for you. However, if the napkin was within arm's reach and you didn't have to get up to get it, then simply reach down and pick it up.
When finished dining, place the napkin neatly on the table, to the right side of the plate. You do not have to refold the napkin perfectly as it was in the beginning, but don't leave it crumpled up either.
Food taken out of the mouth should come out the way it went in. If you used a fork, then gently spit the food back onto the fork. If you need to get out a piece of fish bone, use your fingers.
Napkins are supposed to be used to dab the corners of the mouth, never use it to blow one's nose (which should be done in the restroom). Also, never use it to wipe your face.