Q: "A group of people sit on and in front of a graffiti covered wall." Does this mean that "A group of people sit on a graffiti covered wall."?
A: yes

Q: "Three people watch a fourth draw a chalk portrait on the street." Does this mean that "The street performer is a chalk artist."?
A: it is not possible to tell

Q: "Three women wearing blue walk along a sidewalk while laughing and smiling." Does this mean that "Women walk together outdoors."?
A: yes

Q: "The handle on the mug is small and would be difficult to hold with large hands." Does this mean that "The mug is broken"?
A:
no