First: 1,700 times at what temperature and pressure?
Volume is not an intrinsic fixed property of a gas. Gas volume changes with temperature and pressure. The “1,700 times” figure is an approximate comparison between liquid water and water vapor near 100°C at one atmosphere.
Let's calculate it from one gram
One milliliter of liquid water has a mass of approximately one gram. That same gram contains the same number of H₂O molecules after boiling.
Molar mass of water: 18.0 g/mol.
One gram is approximately 1/18.0 mol.
At 100°C (373 K) and 1 atm, the ideal gas law gives a molar volume of 30.6 L/mol.
So one gram of steam occupies 30.6/18.0 ≈ 1.70 L.
That is where the famous multiplier comes from. It is an approximation, not a universal conversion factor.
What's changing at the molecular level?
In the liquid, water molecules remain close together. In a gas at atmospheric pressure, molecules are much farther apart on average. The molecules themselves don't expand 1,700 times. The empty space between them increases enormously.
Does steam always have a temperature of 100°C?
No. Water boils around 100°C only at approximately 1 atm. At lower pressure it boils at a lower temperature; under higher pressure, at a higher one. After it forms, water vapor can also be heated above its boiling temperature—called superheated steam.
There's another common misconception: the white cloud you see above a kettle is mainly tiny liquid droplets formed when invisible water vapor cools and condenses.
Converting liquid water to vapor doesn't create more H₂O molecules. It gives the same molecules vastly more room. Always specify temperature and pressure when quoting gas volume.
Further reading: OpenStax Chemistry 2e (gases and the ideal gas law).