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Place the peaches in a bowl and cover with 1/2 cup of the sugar. Mix thoroughly. Allow the peaches to sit for 1 hour.
Using an electric mixer, fitted with a paddle, cream the butter and remaining 3/4 cup of sugar until smooth and pale in color, about 3 minutes. Add the eggs, one at a time, and beat until fluffy, about 2 minutes. In a mixing bowl, combine 3 1/2 cups of the flour, baking powder, and salt. Remove the bowl from the mixer and alternately fold in the milk and flour mixture, being careful not to over mix. Fold in the peaches. Spoon 1/4 cup of the filling into each prepared muffin cup. In a small bowl, combine the remaining flour, brown sugar, pecans, and cinnamon. Mix well. Add the butter. Using your hands, mix until the mixture resembles coarse crumb like mixture. Sprinkle 1 tablespoon of the crumb mixture over each muffin cup. Place in the oven and bake for about 15 to 20 minutes or until golden brown. Serve warm with butter.