This picture on Cricinfo reveals that Pietersen's sweep shot strays into a gray area of the law, and given the evidence is illegal in my view.
Pietersen is a right handed batsman, and therefore the top hand on the bat should be the left hand. While playing the reverse sweep Pietersen reverses his grip on the bat playing effectively as a left handed batsman.
Here is the problem - Law 41.5 clearly states that
"At the instant of the bowler's delivery there shall not be more than two fielders, other than the wicket-keeper, behind the popping crease on the on side. A fielder will be considered to be behind the popping crease unless the whole of his person, whether grounded or in the air, is in front of this line. In the event of infringement of this Law by the fielding side, the umpire at the striker's end shall call and signal No ball."
Now, technically, Pietersen and other batsmen could argue that their being right handed or left handed, is not necessarily defined by how they hold the bat but is defined by how they are listed on the scoresheet - RHB or LHB. But, if he changes hands, then what was formely his "off-side" now becomes his leg-side..... therefore, a bowling side which has a slip, a short third man and a short cover point - all behind square on Pietersen's off side (in his normal stance) are now liable to being no-balled. Either that, or the bodyline inspired law needs to be reviewed.
Further the on-side, off-side differentiation is also relevant in the LBW law - the batsman is protected from balls pitching outside his leg stump because the ball pitching outside the leg stump is considered to be on the batsmans "blind side". If the batsman reverses hands, and is therefore no longer blind sided by the ball pitching outside the right handers leg stump, would he be liable t being given out LBW if he misses the reverse sweep? For example - a Slow Left Arm Bowler, bowling over the wicket into the rough outside Pietersen's leg-stump, to which Pietersen reverses hands on the bat (effectively turns around at the crease), attempts the reverse sweep, misses and his struck on the shin in front of his (formerly) leg-stump (now his off-stump) - technically, this wouldn't even merit an LBW appeal right now...... but why not?
Umpires have called dead ball when batsmen have switched hands before - most notably in the case of Craig MacMillan where a boundary was disallowed. Has a resolution been reached since? The Laws of Cricket do not explicitly describe what by definition is a right handed batsman or left handed batsman - may be they need to revise the laws to include this.
In any case, right now, Pietersen is in effect manufacturing a free hit by employing something that is atleast sharp practice. I say so, because this is not a maverick individualistic thing, but is something which has been probably drilled into the batsmen by Duncan Fletcher - Fletcher probably identified this gray area and pounced to exploit it.
Its time the Laws were revised to resolve this - one way or the other. It could simply be a case of declaring that a batsman is a right handed batsman, unless he declares otherwise, irrespective of how he holds the bat. Now, this would be unsatisfactory from the point of view of the LBW law.... but it would simply be one more in a long series of revisions which favor the batsman.
Either ways, something needs to be done. Inconsistent umpiring, where some umpires look the other way, while others (i believe it was Taufel in the case of MacMillan) enforce the law - or in some cases, the same umpire ruling inconsistently in this matter, does not help.
Update: G Rajaraman makes the pertinent point that the "At the instant of the bowler's delivery" clause is the key here. It is the key from the point of view of a fielder in the deep field moving around (which is not technically illegal) - but it could also be applicable to the batsman. There may be a distinction between the batsman making his move before and after the instant of delivery. This would however be difficult to gauge. Especially in the case of bowlers trying to exploit the rough outside leg-stump, this ought not to be a free hit for the batsman in my view.