Plenty of people will buy the high end one, and as with any other high end products, the vast majority of people will consider them fools. No different than a person buying a Bugatti Veyron to drive his kid to school when really, a Honda is more practical.
I think the common thing not being noted by people is that while, yes - you can buy a $17,000 Apple Watch, the entry level one offers the same functionality for $349. Others are also (foolishly, imho) defending the $17k version with "Well, it's a limited edition and the gold value alone in that watch is worth $12k - $15k itself). There's a simple fact here that there are traditional watches on the market now for half a million dollars. You can spend $30,000 on a Rolex and not even be buying their high end. $17,000 is a mere drop in the bucket compared to something like a Greubel Forsey watch, which is $750,000.
As for the watch as a whole, it's a Rev. 1 device. While is does have some unique features compared to the other smart watches, it's also a pretty widely known in joke that anyone buying Rev. 1 Apple devices is in effect a paying beta tester. There's also been rumors that on the higher end ones, a trade-in program might be offered for the next versions, so that may make a bit more sense, but I'll believe that rumor when I see it. A trade in program directly via Apple is very un-Apple like.
All this being said, I do think the Apple Watch will be wildly successful. I have no doubts we will see the $17,000 ones on the wrists of A List celebs and the like. That being said, I've often joked that Apple could bronze a pile of dog turds, add an Apple logo, and people would be lining up to buy them as some sort of status/geek chic symbol. Until battery life on smart watches as a whole gets into the 7+ days zone, they are just impractical for most people at any price.