There's no way that a teenager just turned 17 would knowingly be allowed to live alone and outside foster care unless emancipated. Maybe if he were a few weeks short of 18, it might be overlooked.
1.)18. As a January birth, he'd almost-certainly be 18 at graduation. Most school districts will not enroll a 4 year old unless they're imminently turning 5 so the DOB cut-off is usually Sept. 1 with a little leeway. As a January birth, he'd be starting K at age 5 and 9 mos. Generally the kids who graduate from HS at 17 are the ones born in the summer...or the ones like my brother the November birth. My parents wanted him in school a year behind me so they basically-lied then once he was enrolled and in-school, dared the district to throw him out and make him re-enroll the following September.
2.) Absent sexual, physical or psychological abuse, no. Even then, the process is an intentionally long one and he'd be group-homed in the meanwhile.
Your simplest solution might be subterfuge...the facade that he's got an adult living with him, as a late-teen he'd be given wide discretion to choose to live with a long-time-known adult friend or the parents of a friend provided that adult passed muster and home-inspection with family-services. It adds another element of intrigue for you to work with, maintaining that facade...especially since they like to do surprise inspections unannounced to catch this exact scheme.
Edit: or as Hope Hoops said an absentee guardian.
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