Usually "Redonkey Kong" is used as a positive expression, applied to something perceived as good, usually surprisingly so. Though it can be used in special circumstances that are outrageous, even in a negative way.
Made popular by the Hit television show "30 Rock" in the episode "The Source Awards", although in the show it is implied that Redonkey Kong is the alias of a fictional musician that has a beef with Tracey Jordan.
Despite Redonkey Kong being debuted on 30 Rock its origins are unknown. Though it can be assumed it came to be due to the similar sound of "Redonkey Kong" to "Ridiculous". Also, the iconic game Donkey Kong is, itself, Ridiculous.