This technique sounds similar to the German Rumtopf recipes.....but fruit and rum or any alcohol is used.
The fresh or canned or dried fruits are layered with the alcohol and set in a dark, cool place to sit for weeks/months.
I have never heard of this particular technique where pickled items are drained and replaced with just sugar.
I think the most important consideration is sterilization of the jars and lids and that there be absolutely no contamination during the transfer process from the sugaring container to the smaller, give away containers. Due to the amount of vinegar still remaining the jalapenos, and that sugar is a natural preservative, it stands to reason the recipe would hold for some time, say 6 mos, but not much longer.
I would recommend you do a small test batch for yourself and see what the results are after 6 mos before you inadvertently poison your family and friends.