I have footage shot with AVCHD 1080i25, with field order of upper field first. However, my output should be 720x576 PAL DV25i, which is lower field first. My question is, can the field order be reversed without losing quality, and in what workflow order should I do it?

If I import my footage to a AVCHD1080i25 timeline, the timeline is then upper field first. I can either conform the footage to lower field first (through interpret footage), or work with upper field first timeline without conforming and encode the finished project with PAL DV25i settings, which reverses the field order to lower field first. Which option would be the way to go?

Changing the field order of interlaced video can be fraught with confusing problems.
In my experience, the most bulletproof workflow is to maintain upper field first throughout, including the final delivery format.
The most common example for me is 1080 60i project requiring delivery of DVD, which normally is 720x480 60i, lower field first.
I will actually encode to 720x480 60i upper field first, and burn these files to DVD disk.
They play flawlessly.
I'm not certain what your final destination is, but if for DVD I would leave the field order UFF throughout.

Premiere will not let you encode dv 25 pal to upper (dv-avi, mxf)
mpeg2-dvd is no problem.