The flight instructor and student pilot were conducting a night visual flight rules training flight, which included a recovery from an unusual attitude. During the recovery maneuver, the student pilot became concerned about the airplane’s proximity to mountainous terrain. The flight instructor and student pilot then both focused their attention on the multi-function display (MFD) to confirm their position. While both pilots were observing the MFD the airplane entered a decent, which the instructor and student pilot both failed to notice until the terrain was illuminated by the landing light. The flight instructor then took control of the airplane; however, the airplane contacted the ground, which resulted in substantial damage to the left wing and separation of the empennage. The flight instructor reported that there were no mechanical malfunctions or failures with the airplane that would have precluded normal operation.