There's apparently some Japanese folktale about a child that comes to an elderly couple in a giant peach floating down a river. It's referenced in a lot of anime.
i think part of the joke is that the ass looks like a peach
Well, it was certainly drawn like that. However, her name or nickname is "Momoga" and according to Garrus the folktale which is parodied here is called "Momotaro".
