Can you make latte-art with a panarello wand?
Yes, you can.  And it is not too easy.

Microfoam has small bubbles by definition and the panarello wand will draw a 'certain' amount of air and you can't really control that part.  The notes below might help you get there.  I have successfully done this with the panarello wands of automatic Saeco machines which aren't too different from deLonghi.


Run your steam wand in a cup water first until it's fully producing steam and not spuddering hot water mixed with steam.
Use a small Stainless Steel Milk Frothing Pitcher.  If the wand is trying to blow steam and air in for a long time, you'll end up with big bubbles.  That wand is not as powerful as a commercial espresso machine with a proper boiler.
'Stretch' the froth only for a few seconds in the beginning.
Keep the wand off-center in the pitcher to encourage circulation (see next point).
Most important: make sure you create a whirlpool to circulate the milk (helps to gently move the pitcher in a circular motion to encourage the start of the whirlpool).
I use the fattiest milk I can find.



  The trick is to move the milk in a circulation such that big bubbles
  break and only microbubbles survive.  Some microfoam creation also
  happens at the vortex of the whirlpool.