Are you sure they cook with pallet wood or just heat the water? Up in new England they often use local wood to heat fresh sea water and cook the lobsters and steamers in that. Its done outdoors
The shellfish don’t get any smoke so it really doesnt matter what the heat source is.
If I showed up and a place was cooking food directly over pallet wood, I’d probably not eat there.
Then again, I have been using whisky barrel chips for a while now and love cooking steaks over them. The steaks come out with almost a dry aged taste…really cool stuff.
As for wood my lineup is…
Hickory, of course…ribs, shoulders, brisket, salmon, ducks (some say it is too strong but I love hickory duck)
Mesquite that I put into a 15/85 or 90/10 mix…burgers
Cherry= bluefin tuna belly, chicken, sometimes shoulder
Apple= fish, chicken
Whisky oak= steaks
Pecan= ribs and usually some mesquite in that mix