I'm going to be the voice of dissent here and mention my Panaque lived for about 7 years in a Malawi cichlid tank. She was fine, though a bit shy, and perhaps didn't grow much because she didn't have as much food as she might have done otherwise (the cichlids eating algae and vegetables as happily as the catfish). The pH and hardness isn't such a big deal -- most of the Panaque kept in southern England are kept in hard and alkaline water anyway.
However, I'd comment further and say that my catfish had by this time been in my care for a few years, and she had grown and become used to aquarium life. Putting a newly imported Panaque straight into a Malawi tank might be less successful because you can't be sure the catfish will eat. Buying an older specimen from another aquarist that is already a year or two old is perhaps the way to go.
In terms of temperament, an angry Panaque can more than hold its own with a similarly sized cichlid. Though clumsy, they are extremely powerful, and armed with strong spines and basically bomb-proof thanks to their armour plating.
Cheers, Neale