Layover Time for Rome transfers to Sicily

I think you need to rely on the airlines recommended transfer times. They will not book the ticket if the time is too short. You will go through immigration (Schengen Zone passport control) and then on to your connecting flight in (probably) another terminal. When you arrive in Sicily, after picking up your luggage, you will exit through the (presumably) the "Nothing to Declare" door.

FCO has two potential places where you can be held up: 1 Passport control line (immigration)
2. Baggage claim I don't think no.1 will be a problem unless many international flights happen to arrive when you arrive. No 2 does not apply to you if you fly with the same airline (Alitalia) because you will not pick up your luggage in Rome. Rather the luggage will go through to Sicily where you will pick it up. It will apply to you if you fly with separate tickets with different airlines. If you fly with one ticket with SkyTeam (Alitalia, Delta, AirFrance), you won't need much layover, but if you fly with separate tickets, let's say Delta and the EasyJet to Sicily, you need more time, because you will need to pick up your luggage and check in again.

2. Not sure about the baggage response. Has this changed since I last flew international (I admit it has been awhile)? The last time I did this on an international (not inter EU) flight ALL baggage was removed from the plane at the first stop and you had to take it through customs. If you were continuing on, you rechecked your luggage. Otherwise the airline has to segregate the baggage at the next stop and send some if it to the baggage area inside customs and the rest to the baggage area outside customs.

The practice of having to pick up your luggage at the first port of entry to go through customs and then recheck it applies to the US. In the US both immigration and customs is at the first port of entry. In EU Schengen that is not the case. Immigration (passport control) is at the first port of entry but customs is not, therefore if you fly with the same ticket, the luggage will be retrieved at the destination (Sicily for you, not Rome). However, if you fly with separate tickets, and the FCO to PMO leg is on a low cost airline, e.g. Easy Jet, the luggage will not transfer to Sicily. In that case you have to pick it up and check in again in Rome. So if you buy a ticket from the US to Palermo or Catania with Delta, you will be flying to Rome with a SkyTeam alliance airline (Delta, Alitalia, Air France), then with Alitalia from FCO to PMO/CTA. In this case, it's one ticket, and the luggage will transfer to Sicily without need to pick up in Rome.

Thank you for the clarification.

Thanks for the advice, I guess we will stick to one code-share airline system which would make things easier.