In 10-inch deep-sided nonstick skillet, heat water and butter to boiling over medium-high heat. Stir in potato slices from mix; return to boiling. Boil 15 minutes.
Do not drain potatoes. Stir in contents of sauce packet from mix, the milk, bacon and sugar snap peas. Return to boiling. Reduce heat to medium; cook 4 to 5 minutes longer, stirring occasionally, until sauce is slightly thickened.
Sprinkle with contents of topping packet from mix. If desired, season to taste with pepper.