Technically, since the website displays system requirements for Steam, they are implying that there is more to it than just a 1.5MB platform
To be more specific:
Windows XP, Vista, or 7
512 MB RAM
1 Ghz or faster processor
Intel Mac, OS X version Snow Leopard 10.6.3, or later.
Two-button mouse strongly recommended
1GB HD space (recommended)[/i]
Internet connection (broadband recommended)
They didn't lie about anything. They told you the 1.5MB download of the installer is free (notice how they say "Install Steam Now" rather than "Download Steam Now"). If you're going to complain they aren't upfront about it being an installer... look at the path for the download link where it directs you to an exe named SteamSetup. If that isn't obviously an installer name... well I just don't know anymore
I got that what I'm getting is an installer, which is pretty obvious this day and age. It's also pretty obvious because when was the last time you saw a program that was *only* 1.5MB in size?
Secondly, if steam had put their program on a disc, it'd react the exact same way as an internet installer. You'd pop in the disc, it'd open up an .exe file for the setup (not usually a massive size) and then install the contents on the disc to the directory specified by you
Not really different than downloading an installer which installs the content from a server to a directory on your computer
If you want me to be blatant about how I'm presenting this metaphor: Server with Steam stuff = Content on disc. Installer downloaded = Installer prompt from disc