First and foremost, I'm not a lawyer (yet--only a pre-law student), nor do I live in AZ. Second, I'll try to explain this as best as I can (though any lawyers or law students in the audience--do feel free to add on or correct me) 8^)
Having said that, I don't think it was liberals who wrote such laws. Nor is it "fishy"--although at first glance it does appear something isn't right.
The key principles is in how the statute defines 'sexual contact' and the age of consent (how old one has to be in order to be considered able to consent to sexual activity)--both are defined specifically in each state.
In your case, Arizona defines the age of consent (AOC) at 18 and broadly defines 'sexual contact' to include most any contact with genitalia (there are obvious exceptions--e.g. the doctor's office)
Knowing this, we can figure out what the law means. So, going back to your example...
Under the law, the 17 year old girl cannot legally consent to having anyone touch her breast (age of consent at work), not to mention that touching the female breast is considered 'sexual contact' under the law (sexual contact definition at work).
And because the girl cannot consent, it's considered statutory rape. Thus the stiff penalty--by legal definition, the perpetrator is in fact a rapist.
Interestingly enough, I've heard of cases in a few states (including mine) where the state attorney reviews the cases and generally (as a rule of thumb) doesn't charge most teens caught, er, together so long as both parties are under 18 and within three or four years of each other (e.g. a 16 and a 15 year old), and the parents don't press for charges.
Another thing to consider is whether such contact is a felony or misdemeanor. To use an example, Wisconsin's AOC is also 18. Sexual contact with a minor under 16 is a felony and gets one prison time. However, if the minor(s) in question is/are 16 or 17, it's a misdemeanor punishable by nine months in the county jail and/or a $10,000 fine.
In your case, I would presume that AZ has a similar setup and thus the 15 year old could be charged with a felony and the 17 year old a misdemeanor (though a bit of a stretch, you could argue a felony charge by way of her parts touching his hand)
If one of the parties is over 18 or there is a larger than three or four year gap, then there's no exception.
Is it perfect? Far from it. But IMHO, there aren't any better ways of rectifying the issue--so this is what we have.
Hopefully, this answers your question...8^)
Another problem with it is, is that "Once tried as an adult, always tried as an adult for any other crime even if you are a juvenile." I know that most of the time it is thrown out but if a kid who is just messing around one day and ends up having his entire life ruined because of it is pretty bad and I think the law should be changed to something a little less harsh.