Give them a little space, but they don't need a ton
Dry at 125F/52C for 10-12 hours until they are completely dry.
Allow a sample to cool completely, then test for dryness. It should have a slight honeycomb look to the inside and shatter when crushed
Store in an airtight container.
Notes
Note: the lower drying temperature for Peeps as well as other highly colored/shaped marshmallows is to help stop the puffing of the marshmallow that can happen.