This came up in a tournament today and wasn't sure about it, some help to clear it up would be great.

When a object is dropped due to the character carrying losing super strength or being knocked out and it drops into a square of hindering is the object destroyed?

Thanks in advance!

Looking up the rules, I would say the object is not destroyed, it is just that there is an object on hindering. Now if the object is dropped and there is already another object there then the dropped object is destroyed.

"If, however, a character holding an object is defeated or loses the ability to use Super Strength, the character automatically drops the object, which stays in the square the character occupied when it was defeated or the power was lost. If there is already an object in the square when an object is dropped, the dropped object is removed from the game."
2011 Core Rulebook. Page 19

Also remember that when KO'ing characters with special object like the hammer and the crimson rock that it places back on the map and therefore can have to objects on top of each other.

Gonna ask a follow-up for confirmation:
Power Generator/Dumpster
which, for those of you who don't know, are not destroyed when used in an attack.
Are these dropped in the square the character was holding as well?

Nope, placed in any square adjacent to the attacked character

If they are dropped because the character lost the ability to use super strength, then they are dropped just like other objects. They are removed from the game, if there is already an object in that square. Their protection from destruction only applies when they are used in an attack.

Pukka got it, thanks