Noooooo it's twisty-leaf-itis!
I've seen this problem before when growing peppers. At some point, the new leaves become crinkly and deformed. It seems to go away when the plant is put in a full-sized container in warm weather.
This nice specimen here is my beloved 7-pot plant. It is in potting soil in a decent sized container... the soil is fairly dry and loose, not at all compact. If anything, it might need more water, but it is almost certainly not suffering from over-watering. I don't think I've fertilized it in over 10 days, but my understanding was that I did not need to fertilize young seedlings very often before transplanting them. Well, OK, that's the advice I have used for tomatoes, maybe peppers are different. The plants are kept between 65* and 70* F right now; the tomatoes seem to like it just fine, not sure about the peppers.
So anyway, could it be cool temps, drainage issues, nutrition issues... what? Disease seems very unlikely since they've been inside their whole life, and I see no other signs of illness.
(PS that tomato looks sick because it's the runt of the litter and I have not tried hard to care for it... I'm trying to give away my unwanted plants. :))