I am not sure with what part of the statement you have a problem.
The Delphic Expanse is brick-like in nature, a cuboid. So, if we take in rounding the actual distance across may be 1,000-1,500 ly.
For comparison, the diameter of our galaxy is 100,000-120,000 ly.
You should remember that the Xindi don't have to be all around the Expanse, just on the relative border.
1000 light years is absurdly massive itself.
Using Archer's statement that there are intelligent species on one in every 47,000 planets, there are a minimum of 2.1 million species in the Milky Way.
There are 200,000,000,000 to 400,000,000,000 stars in the Milky Way, and according to NASA, on average, there are at least
one planet per star.
In TNG and DS9, starships traverse the entire Federation in days or weeks, suggesting a total diameter of maybe 100 light years (as it's core), and a few outlying stars like Deneb being far-away members separated from this core. This is the only picture of the Federation that makes total, and beautifully elegant, sense.
So a 1000 light year diameter region is absurdly massive, especially when it was only 50 light years from Earth, and never mentioned before.