Kramer's Cafe

Kramer's is owned and run by a German guy named Rene and his Filipina wife, Jane. It's a great place to get some good food, try the local brew, and see the sun set. The location is right on the water and it is upstairs so you will typically feel a nice breeze.
I recommend the Blackened Sashimi, Black Bean Taco Salad with grilled catch-of-the-day, the cheeseburger is one of the best on island and the specials are usually pretty tasty too. Rene is a good cook and supervises his kitchen staff to create worthy culinary delights.
The music selection here is the widest in the islands and Rene will probably let you sit down and make up your own playlist. There are a couple of dart boards and a foozeball table as well. Sometimes they clear out the tables and people start dancing. Especially when one of the lawyers has a birthday.
Kramer's is primarily an expat bar. There are Palauans that drink there, but if it is Palauans you seek then you are better off at a Palauan Cha Cha bar, pool hall, or karaoke bar.