I have a LAN with two OS X boxen logging into a debian woody server running ssh2d. Both are running OS X 10.2.8 but one will time out after about 10 minutes of no activity with the following message:
Read from remote host <hostname>: Connection reset by peer Connection to <hostname> closed.
I've had similar problems before (from Linux boxes though) and I found that adjusting the kernel's tcp_keepalive_time on the client did the trick. It might also work if you just do it on the server. Here are some cool methods:
http://www.nclug.org/pipermail/nclug/2001-March/001000.html
-Mike
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