Once the four species have been taken on the first day, they are considered to be set aside (muktzeh) for the mitzva and may not be used for any other purpose. Therefore, one may not eat the etrog or smell the hadasim during the festival. One may not even use the hadasim for havdala after Shabbat. Even if the etrog or hadasim become invalid during the course of Sukkot, they are still muktzeh until the end of the festival (SA 653:1 and 665:1).
It is, however, permissible to smell an etrog, because its primary purpose is for eating, so it is muktzeh only in this regard; it is not muktzeh with respect to its aroma (Sukka 37b). If one picks up an etrog with the idea of fulfilling the mitzva and also enjoying its smell, uncertainty arises regarding the proper berakha. Some say that since he is deriving pleasure from its fragrance, he should recite the berakha of “Who gives pleasant fragrance to fruits.” Others say that since the primary reason he is picking it up is to fulfill the mitzva, he should not recite this berakha. In order to remove this uncertainty, it is proper for one to have in mind when picking up the etrog that he is doing so in order to fulfill the mitzva and not to enjoy its scent (SA 216:14 and 653:1). However, if someone wishes to smell the etrog at a time when he is not fulfilling the mitzva, he recites the berakha of “Who gives pleasant fragrance to fruits.”[6]
When the festival ends, the species cease being muktzeh and may be used for any purpose. However, they may not be treated disrespectfully; for instance, they may not be stepped on or thrown into the garbage (SA 664:8).
If one had in mind before taking the four species that they would not become muktzeh, but rather could be used in whatever way he wanted, this condition is effective. They do not become muktzeh and can be used without restriction during the festival.[7]
[7]. Sukka 46b states that if one set aside seven etrogim, one per day for each of the seven days of the festival, then each etrog becomes muktzeh on its designated day; however, once that day is over, it is permissible to eat that day’s etrog. This is the ruling of SA 665:2. If one made a condition from the start that the four species would not become muktzeh, then they do not, and they may be used freely. Bi’ur Halakha explains that according to Tosafot, on the first Yom Tov, when the four species must be whole, this condition does not take effect. It is only for the rest of the festival that it is effective. However, according to Rashba, Ran, and Yere’im, the condition is effective even on the first Yom Tov, and this is the position cited in SA 664:9 (BHL 664:9 s.v. “im”).