Sterilize five (8-ounce) canning jars, or whatever size you have on hand.
Put the apples and peppers into a large saucepan. In a small bowl, combine 1/2 cup sugar with the Sure-Jell. Stir this mixture into the apples and peppers. Cook over medium-high heat until mixture comes to a boil. Cook and stir for 5 minutes.
Add the vinegar, water and remaining sugar. Return to a rolling boil; boil for about 1 minute. Remove from heat.
Ladle the hot jam immediately into the hot, sterilized jars. Cover with sterilized lids and screw on the band. Do a water bath if you like, according to the instructions on the Sure-Jell package.
Flip the jars upside down and let sit until cool, then flip them back upright. Leave the lids on for 24 hours. If any of the jars do not seal, store them in the refrigerator and use within two months; otherwise, store in a cool, dark cupboard and use within six months.