Given only one palindrome, you will have to do it in O(N), yes. You can get more efficiency with multi-processors by splitting the string as you said.
Now say you want to do exact DNA matching. These strings are thousands of characters long, and they are very repetitive. This gives us the opportunity to optimize.
Say you split a 1000-char long string into 5 pairs of 100,100. The code will look like this:
isPal(w[0:100],w[-100:]) and isPal(w[101:200], w[-200:-100]) ...
etc... The first time you do these matches, you will have to process them. However, you can add all results you've done into a hashtable mapping pairs to booleans:
isPal = {("ATTAGC", "CGATTA"): True, ("ATTGCA", "CAGTAA"): False}
etc... this will take way too much memory, though. For pairs of 100,100, the hash map will have 2*4^100 elements. Say that you only store two 32-bit hashes of strings as the key, you will need something like 10^55 megabytes, which is ridiculous.
Maybe if you use smaller strings, the problem can be tractable. Then you'll have a huge hashmap, but at least palindrome for let's say 10x10 pairs will take O(1), so checking if a 1000 string is a palindrome will take 100 lookups instead of 500 compares. It's still O(N), though...
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