Holidays for 17 year olds? Watch
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Flights with Ryanair and stuff are nice and cheap, and hotels aren't too badly priced in Italy.
For us it worked out at £340 for travel from the Chester to Milan and back, 2 nights in a 4* in Milan, a train to Venice, 3 nights in a 3* on Murano, a train back to Milan then a 2 night stay in Milan in 4* again. I took £220 worth of euros and came back with about 20euros.
It is possible to do Italy on the cheap, but if I had £1000 I'd be looking at first class trains and all the museums I wanted.
Florence is really good for museums and history, especially if you like art. I don't really know where to suggest for you to go to if you're looking for beaches because thats not what I do, but Florence or Rome aren't too far from the cost on the trains.
Just e-mail the hotels before booking them, I have been turned down twice before booking because they want the minimum check-in age to be 18, but for the most you'll be fine!