Gorgeous location, spacious rooms, thoughtful hosts, comfortable, convenient... this place is amazing. We have stayed at Peppers previously, but we'll always stay here now.
It's located right on the lakefront, maybe 100m from the well known Church of the Good Shepherd. The rooms generally have seperate kitchens, bathrooms, bedrooms, and living areas, most with patios or verandahs. Ours was a beautiful wooden affair with heated floors, an amazing patio, lovely bathroom, and a comfortable huge bed.
The hosts are incredibly helpful - they'll give you lots of info on things to do in and around Lake Tekapo (and there really is days worth of activities to do). As an example of how thoughtful and helpful they were, we woke up on our first morning to find they'd gone out during the night and put a frost blanket on our car to save us having to defrost it in the morning!