The first massive appearance of this flag in Florence was in the fall 2002 during the No-Global demonstration. It has been present in Italian cities ever since and has become an easy and fairly effective form of protest for the common people who are usually too busy making ends meet to take active part in political campaigns.

The following is an excerpt from http://flagspot.net:
You might be interested in the peace campaign that has been ongoing in Italy since early autumn (2002). "Peace from every balcony" is an effort to get people to show their opposition to war in general and specifically Italian participation in the US military campaign against Iraq. see www.bandieredipace.org. It's only in Italian but basically the idea is to fill the cities of Italy with the rainbow flag.
There have been also controversies about the similarity of this flag with the rainbow-"Gay Pride" one. Some traditionalist catholics blame that they are almost identical and good catholics should not use it. An Italian gay leader, Franco Grillini, has said that the pacifist flag was created before the "rainbow-"Gay Pride" one, as it was first used in 1961 by Aldo Capitini, leader of the Italian non-violent movement.
More information about the Italian peace flag from flagspot.net

How to obtain the flag:
There are many distributors to choose from around Italy. Bellow is the bandieredipace.org page of distributors. It's in Italian but not to worry, you'll see a map of Italy, click on a region, Lombardia has 155 distributors so I'd try it first. There are various organizations on the list ranging from book shops to cooperatives, church clubs, associations, committees, etc. Most of them have an email address you can contact and I'm sure many would be willing to send flags to you. They should cost about €5 each.
http://www.bandieredipace.org/index.php?pagina=distribuzione