I think it is appropiate. I am planning my wedding for a Sunday during Martin Luther King Jr Weekend in January 2008. It will be a destination wedding and I wanted to give people time to get there and back without having to take too much time off work.
You are lucky - most people have Memorial Day off! I know I have MLK day off, but not everyone does.
One more thing - a friend of mine had her wedding on the Sunday of Memorial Day, so don't stress it. Happy planning.
What is wrong with having your wedding on Sunday of Memorial weekend: one little old lady will grumble about how "you aren't supposed to do that". It's okay, you didn't want her there anyway!
What's good about it: People are already off work so even your travelers don't have to worry about time off. It is a holiday weekend and people are ready to celebrate. You have all of Saturday off to take care of last minute stuff and you don't have to miss any work. Everything is cheaper when you don't get married on Saturday.