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When creating or editing a news category you can add an icon to that category.
To have the icon visible you have to select the correct options for it when creating or editing a news article. The icon have to be activated per news article as far as I know.
I don't which section module you mean, but I think it's SmartSection.
There's no manual for this module yet. There's a start of a manual on the XOOPS Documents site
here, but that isn't finished.