Moton Hogholm suggested the solution which works just fine:
For the osf option, use the praeamble
\usepackage[osf]{mathpazo}
\usepackage[T1]{fontenc}
\normalfont
\DeclareFontShape{T1}{pplj}{m}{it}{<-> s * [.97] pplri9d}{}
\DeclareFontShape{T1}{pplj}{b}{it}{<-> s * [.97] pplbi9d}{}
For the sc option just use `pplx' instead of `pplj' and filenames pplri9d
and pplbi9d.
The scaling factor (.97) in the example above can be adjusted appropriately. Ekkehart
