So it stands to reason it will work in Java 1.17 when it is released.
Well in recent shapshot they did not release the new world generation that should include the new mountains and the new caves, so it's a mistery what will be changed in the final 1.17 regarding world generation.
I don't think it will be a revolution, but also I don't know if the world height limit will be changed, it was a strong rumor after last “minecon”.
I know for a fact you can increase the world height limit now with datapack in the recent snapshots (We have a server live starting at -1024 and going to 1024)
As for if mojang will use these new features in 1.17 I am unsure, I suspect they will increase vanilla generation settings to 0-512 or something and then datapack developers can modify it further if desired.
I don't know these seeds still work in the latest version but people have been finding mountains as high the height limit (256) since 1.7, when the current world generator was implemented (since then only minor changes have been made, such as splitting oceans into multiple biomes but the majority of land, and I believe the terrain height map, should be the same):
I found something similar in the last I game I played, (Dec. 2020). It was a pair of small floating islands, a good 60+ blocks above the highest peak in a Shattered Savanha. Quite impressive. I'll try to remember to post a pic and seed if I get back to that game.