Not necessarily. If there's enough material to allow such a thing, it shouldn't be any more painful than wearing a condom.
Except that condoms don't go and suck up all the moisture in their immediate vicinity, and most panties are made of materials much rougher than the latex or similar that condoms are made of. I can tell you from experience that wet panties are pretty rough on penises in short order. The amount of lube it would take to allow this to approach comfortable for any reasonable length of time for the man (let alone the woman!) would be absurd.
I realize that this is completely impractical in real life for numerous reasons but damn do I find it hot.
Yeah, there are a lot of impractical things that I find hot. But when people start to talk about them like they're not at all impractical, I get a strong urge to disabuse them of such notions.