Rabbits are very chewy animals. Their teeth are constantly growing so they have an instinctive urge to chew. Our Flemish babies have ample food to eat. Green leafy veggies, pellets, and fruit treats. They instinctively love to chew their oat hay that’s in their litter boxes. . The straw helps grind down their teeth and they love the oat kernels. Their litter boxes, of oat hay are lined with newspaper. They will dig out the hay and then eat the newspaper…this notwithstanding the fact they are amply fed. There’s more. We have cardboard boxes under the dining room table for them to play with. They love to push the cardboard boxes, jump in them, and also eat them. Rabbits can eat paper to some extent without harm. Their cecum stomach can digest cellulose so paper is technically possible for them to eat. (The ink may not be good for them).
Rabbits can digest cellulose, so paper and cotton will probably be OK.. They cannot digest polyester and other like artificial fabrics.
If it’s OK for bunny to eat his bedding, you need to know what it’s made of.
And as an additional note. They are active animals. They like to have cage free time. They usually are very good with litter box behavior so it’s safe to let them have free time to hop around, When we got our two rabbits, they were about three months old and we let them roam free in the house until we went to bed or left the house. When we wanted them back in their pen, it was a real problem to shoo them back in. They didn’t like being in the pen. We gave up, and left the pen door open 24/7. Now that the pen door is constantly open they like to be in the pen! They do like to exercise and run around the house every now and then.