While making reservations on last week's Western, the Tuesday night table had the longest line. I think that is the best night.
You are skipping the restaurant which you would have had three nights. Also, if you have Main seating, I would recommend having Palo about the same time, so you could pick up kids to enjoy the show at 8:30.
As others have mentioned, you may want to keep your regular dining rotation for Formal and Semi-Formal night (Monday and Thursday).
On the first night, you are still exploring the ship, and may not have your suitcases by dinner.
Wednesday is Pirate night, and that just sounds too weird for Palo.
Sunday could also be good if you were not in Animator's Palate.
Friday night could also be fun, but I think there is too much else going on that night to spend the time in Palo.
But any night is a good night. Just be prepared to eat a lot.