You can quilt over applique. I've found that using wonder under light works the best for my machines with not gumming up the needles(it will cause skipped stitches). I'm starting to not use fusible when I applique so I never have to worry about it. There are so many different ways of doing applique.
I've done both, quilted the applique and went around it. Both look fine. It just depends on the look you are going for.