Are dropped alien items automatically picked up at the end of a mission?
If one of the aliens, e.g. a sectoid, drops an item when it is killed but I complete the mission before picking it up - do I still get whatever the item is? Or is it lost forever?
You do seem to collect some stuff after a mission, but I haven't been able to see if that includes drop items like weapon mods etc.
Yes you will. Any items dropped upon mission success is immediately picked up. I've gotten dropped items that turned out to be weapon mods despite not picking them up.
Yes, it is stated as one of the loading tips: