The term dates back to a camping outing in the late 80's where a friend of "House" (whom we called "Elvis") was having an inebriated conversation in which blowjobs (oral sex) was compared with whiskey. The analogy stated that you can have quick, nasty oral sex such as a quicky blowjob in a public restroom or in your car and that compares with the cheap, off-brands of whiskey which you also drink hastily and "chug" down. On the other hand, you have the finer, more desireable blowjobs where you are much more relaxed, take your time and truly enjoy the whole sexual experience much more, such as one done privately with some extremely hot girl you are dating. In turn, this compares with the finer, more expensive, quality bourbons which are poured into nice snifters or tumblers and sipped slowly at a special time and enjoyed much more- such as with fine Kentucky sipping whiskey. At this point someone asked "Elvis" if this meant that a quality blowjob meant you had a "sipping penis" and the group consensus was yes, indeed. A fine, quality blowjob was indicative of a "sipping penis". Of course, when "Elvis" used the term with his southern drawl, it was soon emulated with the spelling "sippin" and the penis term likewise pronounced in accord with the dialect.
Jennifer and I went on vacation. We spent the weekend in her folks' cabin and while watching the sun set on the porch, she gave me a knob job. Man, that was the best BJ I've ever had... she was truly sippin' penis!