It seems that Olympus does list an SZ-17 on their Chinese page and the specifications match with the SZ-16. Somes a very subtle variant can appear such as not listing Taiwan on the chose of user-locations nor a feature may be different, particularly things like WiFi and GPS which are governed by regulations which are not uniform everywhere. It is most likely the former as the cameras measure and weigh exactly them same.
There are other cases when an odd model appears legitimately. That involves an important and massive distributor which gets an exclusive model because of their volume of sales. Fuji did that once with Best Buy, giving them an F30SE while the generally-available model was the F30. The only difference was the cardboard box.
EDITED - Thanks for @mattdm for finding that. It does not appear in Google Search from my location.
It is probably a fake. Olympus has no SZ-17 listed anywhere, nor did they send any press-releases for such a camera. As one would expect, companies who make products generally announce them and advertise them.
The store you saw may have just re-labelled an SZ-16 to make it seem newer. Sometimes, a company clones another brand's model by sourcing the same parts. In some cases, these clones are built in the same factory as the original! Personally, I would stay clear of such practices even if they can save a few dollars as they remove revenue from the R&D andincome to make future models.