YES

Problem:
 __(__(X,Y),Z) -> __(X,__(Y,Z))
 __(X,nil()) -> X
 __(nil(),X) -> X
 and(tt(),X) -> activate(X)
 isNePal(__(I,__(P,I))) -> tt()
 activate(X) -> X

Proof:
 Matrix Interpretation Processor: dim=3
  
  interpretation:
                   [1 0 0]     [1]
   [isNePal](x0) = [0 0 0]x0 + [0]
                   [0 0 0]     [1],
   
                    [1 1 1]     [1]
   [activate](x0) = [0 1 1]x0 + [1]
                    [0 0 1]     [1],
   
                   [1 0 0]     [1 1 1]     [1]
   [and](x0, x1) = [0 0 1]x0 + [0 1 1]x1 + [0]
                   [0 0 0]     [0 0 1]     [1],
   
          [0]
   [tt] = [0]
          [1],
   
           [1]
   [nil] = [0]
           [0],
   
                         
   [__](x0, x1) = x0 + x1
                         
  orientation:
                                                         
   __(__(X,Y),Z) = X + Y + Z >= X + Y + Z = __(X,__(Y,Z))
                                                         
   
                     [1]         
   __(X,nil()) = X + [0] >= X = X
                     [0]         
   
                     [1]         
   __(nil(),X) = X + [0] >= X = X
                     [0]         
   
                 [1 1 1]    [1]    [1 1 1]    [1]              
   and(tt(),X) = [0 1 1]X + [1] >= [0 1 1]X + [1] = activate(X)
                 [0 0 1]    [1]    [0 0 1]    [1]              
   
                            [2 0 0]    [1 0 0]    [1]    [0]       
   isNePal(__(I,__(P,I))) = [0 0 0]I + [0 0 0]P + [0] >= [0] = tt()
                            [0 0 0]    [0 0 0]    [1]    [1]       
   
                 [1 1 1]    [1]         
   activate(X) = [0 1 1]X + [1] >= X = X
                 [0 0 1]    [1]         
  problem:
   __(__(X,Y),Z) -> __(X,__(Y,Z))
   and(tt(),X) -> activate(X)
  Matrix Interpretation Processor: dim=3
   
   interpretation:
                     [1 0 0]  
    [activate](x0) = [0 0 0]x0
                     [0 0 0]  ,
    
                    [1 0 0]     [1 0 1]     [1]
    [and](x0, x1) = [0 0 0]x0 + [0 0 0]x1 + [1]
                    [0 0 0]     [0 0 1]     [0],
    
           [0]
    [tt] = [0]
           [0],
    
                   [1 0 0]     [1 1 1]  
    [__](x0, x1) = [0 1 1]x0 + [0 0 0]x1
                   [0 0 0]     [0 0 0]  
   orientation:
                    [1 0 0]    [1 1 1]    [1 1 1]     [1 0 0]    [1 1 1]    [1 1 1]                 
    __(__(X,Y),Z) = [0 1 1]X + [0 0 0]Y + [0 0 0]Z >= [0 1 1]X + [0 0 0]Y + [0 0 0]Z = __(X,__(Y,Z))
                    [0 0 0]    [0 0 0]    [0 0 0]     [0 0 0]    [0 0 0]    [0 0 0]                 
    
                  [1 0 1]    [1]    [1 0 0]               
    and(tt(),X) = [0 0 0]X + [1] >= [0 0 0]X = activate(X)
                  [0 0 1]    [0]    [0 0 0]               
   problem:
    __(__(X,Y),Z) -> __(X,__(Y,Z))
   Matrix Interpretation Processor: dim=1
    
    interpretation:
     [__](x0, x1) = 2x0 + x1 + 1
    orientation:
     __(__(X,Y),Z) = 4X + 2Y + Z + 3 >= 2X + 2Y + Z + 2 = __(X,__(Y,Z))
    problem:
     
    Qed