And, of course, the answer is "halo effect". I mean, it is going to be the highest binned silicon, but we don't know what AMD's binning process and tolerances are, so we don't know how much better it is than the 1700X. I mean, why is the i7 6850K 50% more expensive than the i7 6800k? The only real difference is the number of PCIe lanes available from the processor - sure that's worth a mark up, but 50%?!
No, it's the same class of product, but if you price it high enough it achieves a halo effect - it's the best in its class. There are plenty of people out there who'll only be happy with the best, and if AMD can essentially sell those people a 1700X at a 25% mark-up, why wouldn't they? A small number of customers get to feel smug about having the best-in-class processor, and everyone feels smug that they paid a lot less for basically the same performance.
Besides, the 1800X - if the pricing rumours are correct - will still be significantly cheaper than Intel's best 6C/12T chip, let alone their 8C/16T ones. It's a good place for AMD to be - they've more than doubled the selling price of their most expensive chip, yet they're still likely to be much cheaper than comparable Intel chips, and it looks like they'll be competitive in performance terms.