Besides the 33% increase in RAM fro the A16 Bionic to the A17 Pro, there's also the change from a 5nm process to a 3nm process (40% reduction in size) and the neural engine improvements ... from 17 TOPS (trillion operations per second) in the A16 Bionic to 35 TOPS in the A17 Pro.
So, we have a 33% increase RAM, a 40% reduction in process size, and greater than 100% increase in neural engine performance (which the AI features are going to lean extremely heavily on).
Those are major, directly relevant improvements. The on-device AI functionality they showed is extremely demanding and I'm certain if they enabled it on the prior phones while it might ... 'work' ... it would probably result in a laggy, jittery experience across the device.
I'm just guessing here, but given the sudden explosion of AI on the scene, and how fast it's moving, I suspect Apple was kind of backed into a corner and had to come out with something 'now'-ish. And whatever they came out with couldn't just be some token chat integration, it had to be comprehensive, robust, and amazing. I'm sure Apple would've loved to have waited another year or two to really nail things down and polish it completely ... which would've also had the side effect of having more years worth of hardware capable of running the new software.
But, they didn't have that time.