The phrase "isn't that peachy" is an idiomatic expression that is often used sarcastically or ironically. It typically conveys a sense of discontent or annoyance about a situation, suggesting that something is not as great or positive as it might seem.
For example, if someone shares bad news or a frustrating experience, responding with "isn't that peachy" implies that the speaker finds the situation less than ideal, even though the phrase itself sounds cheerful. It can also be used to mockingly highlight a situation that is overly optimistic or unrealistic.
In summary, while the words may sound pleasant, the tone and context usually indicate a negative sentiment.