All of my regular Jackson contacts seem to be out skiing (jerks!), so I just talked to the Ski School. According to them at 1:15pm MST on 1/2/02, Pepi is very much alive and skiing.
I was fortunate enough to ski with him a few runs during Jackson's early season race camp just three weeks ago. I also used to work for him a few years back. So for me, that rumor was quite a shock.
He's got a great sense of humor. He'd probably get quite a kick out of hearing of his demise.