Reply #7: I first heard it about 7 years ago...

[Ricdude]

I was reliving my old glory days of 8-bit computer geekdom by hanging out in a Linux/geek irc channel, and managed to help some kid through a programming problem. He responded with, "Dude, you're a pimp!". I had to ask, "Is that a good thing?" He assured me that it was... I suspect the Contemporary Urban revival of the 70's has something to do with it.

My personal favourite invokation of it is MTV's car makeover show, "Pimp My Ride". Wherein XZIBIT (a contemporary rap artist) takes a junker of a car from someone, usually with a street value of $100, and puts about $25,000 of custom body work, interior work, and entertainment system into it.