If Sunday is the first day of the week, why do we rest on it when God rested on the seventh day?

Because we changed from the Old Testament to the New Testament. In the Old Covenant the seventh day was the day of rest; in the New Covenant of Jesus Christ, which means the old covenant has been taken away, we rest on the first day, Sunday. So we rest on Sunday because we changed covenants, and that goes for everything else practiced under the old covenant, like the animal sacrifices; it is all passe now, all changed in the New Covenant.