Peng Problems - Act 3 Side Quest
Start Location: The Great Wall
Quest Location: The Great Wall
Objective: Defeat Xiao ~ Great Peng along the Great Wall
Peng Problems is an easy side quest which you'll pick up in Act 3 by speaking with Zi Chan on the Great Wall (pictured above). He asks you to defeat Xiao, a Colossal Peng who is just a tad bit to the northeast along the wall -- you have to run right by him to proceed with the game.
Defeat Xiao then continue along the Great Wall until you come across Bai Li Xi in Shaanxi Province. Speak with him to turn in and complete the quest.