You can host your own Palace, the simple way is to download the Windows server and see if this works for you. But the more reliable way is to use the Linux one, windows servers are not secure and tend to give a lot of problems with more then 8 users.
To install a Linux server you need an account with SSH / shell access and rights to run a service. Apache is only used to serve the media Palace uses and if you choose the Instant Palace pages. You can not use Apache itself to "run" the Palace.
In links / files you will find the server downloads, you need a registered Palace client to administrate your Palace. (register at:
http://palace.webdog.com)
Hope this helps, also try searching this forum for more info. Pretty much all of this has been covered before, you might find some tips and tricks.
good luck and have fun