Is it ok to install wood wall paneling over drywall?
absolutely, that's the right way to do it.
At least one layer of drywall, taped and floated is required by the fire code in my fair city.
Ditto the above responses.
If you are doing the work yourself, do yourself a favor and find the studs in the walls and simply nail the paneling to the wall, DO NOT use glue of any kind. You might have to buy a couple of extra sheets of paneling to do it this way, but it is a much cheaper alternative to replacing the drywall when you have to rip out the paneling for the next owner.
If you are hiring the work done, same recommendation applies, but you would obviously have to stipulate this to the contractor doing the installation.
I sort of agree with the above, and fully agree if you're using a good grade of plywood paneling and not some cheaper composite material. With the cheaper stuff you'll do well to run a nnarrow bead of adhesive about center between the studs you'll be nailing into to reduce the chance of buckling. With the really cheap stuff you'd better trowel mastic everywhere, which will mean a mess when it needs replacement and that will happen sooner than you want. Going with quality doesn't cost, it pays in the long run!