I have an exterior painted wall and am interested in installing a stone veneer. I realize that I may have to install wire mesh to the areas but I'm wondering if there is a material that can be used to apply to the stone to the painted wall without mesh? Or should the paint be removed as much as possible then attach the wire mesh and apply a scratch coat?
You need mesh. While veneer is a fraction of the weight of full stone, it is not light. The mesh forms a framework that the bonding material will surround and be inseparable from it (absent smashing with a hammer). The mesh is firmly attached to the underlying structure with fasteners (type depending on the nature of the siding).
In this case, the painting of the surface makes no difference.
Getting mortar to adhere directly to an existing concrete, stucco, brick or stone surface is not simple, especially when there is a tendency of the attached material to pull away from that surface. Adding to a horizontal surface (like a concrete floor, steps or walk), there is mostly a compression force (pushing the surfaces together), and bonding makes more sense. On a vertical (or overhead) surface, where the force is tension (pulling away), this makes less sense.
I think you need the mesh.
A sand blaster is your tool of choice for removing the paint and leaving a good surface for the mortar to stick to.
Do note that one purpose of the mesh is to help hold the mortar in place while it sets up. It also helps to prevent future cracks from shifting.
i did my fire place it was brick that had been painted , so being an engineer i did a test and took one rock veneer used liquid nails let it set up for a few days then came back took a chair and stood next to it and put my full 240 lbs of body weight on it and it didnt budge i decided i had enough evidence it was safe to procede . i have a fine looking fire place i also grouted the 5/8 gaps between the stones, i think this is an excellent method .
If your substrate is CMU or concrete then you can sandblast it, remove the residue and install stone veneer with a polymer modified mortar or thinset. If it's any other material you'll need to install a weather resistant barrier, metal lath and a scratch coat before installing manufactured stone (no need to sandblast if this is the case). Here's a website with more stone installation techniques.