The way I see it is that you should only use 17" if your car "supports" it.
I find that for a tyre combo to work well on a car, you need some sidewall on the tyres.
It seems like around +/- 95mm of sidewall seems to be an ideal combination for handling.
For Starlet, using 195/50/15 or 205/45/16 gets very close to that 95mm sidewall while remaining close the the standard rolling radius.
But for 17", you need something like 215/35/17 to stay close to the standard rolling radius.
With only 75mm of sidewall available, you pretty much throw handling out the window and it will be a harsh ride.
I have a new VIP Project going that will be using 20" wheels, but even that still have 85mm of sidewall.