When figuring out when you should use olive oil, more than one consideration must be taken into account. Health factors are important, but so are the expense and the cooking characteristics of the oil. Olive oil is exceptional in all but one of these.
Health factors: There are few cooking oils that are healthier than olive oil, for several reasons. Though generally lower in cholesterol, olive oil has far more of the good kind of cholesterol than the bad kind. Several ongoing studies are being performed that are indicating that a diet that includes olive oil helps fight heart disease and stroke. In much of the more modernized areas of the world, these are the leading causes of death for people.
Expense: Though olive oil is healthier than most other cooking oils, it also tends to be more expensive. For instance, in the US, it isn't uncommon for good olive oil to cost four times or more than vegetable oil. If cost were the only thing to worry about when determining when to use olive oil, the answer would simply be, "Rarely".
It isn't the only consideration though, and the health benefits alone make actually make it less expensive than any other oil could be. Consider the cost of a coronary bypass operation due to clogged arteries in the heart. That expense could easily be enough to keep a person stocked up with olive oil for a very long time.
In addition, the price is coming down. At one time, virtually all olive oil came from Europe. That is no longer true. States like California and countries like Mexico now produce olives, and hence olive oil. It still costs quite a bit to produce the oil, and granted, many people still swear by the olive oil that comes from Europe. Still the cost is gradually dropping.
Cooking characteristics: Olive oil adds flavor to nearly anything it is combined with. However, one of its strengths is that it can be used at higher temperatures than vegetable oil without burning. This makes it nearly idea for most cooking. It is also light oil, suitable for use in salad dressings and other cold foods or sauces. Olive oil will accent flavors rather than overwhelming them.
It can even be flavored, by putting slightly heated olive oil in bottles with crushed garlic cloves, tarragon, chives, or other herbs, then corking and allowing it to set for a week or two. In fact, olive oil is so good for this use that it is often used as the base for oil potpourri. At times, it is even used as a skin rub.
The simplest answer to when to use olive oil is whenever you can. The benefits far outweigh the cost. If you aren't using olive oil at every opportunity, you are missing out on a great thing. Try expanding its use and see if you don't see the benefits there for everyone to take advantage of.