We are given two vectors:
\[
\overrightarrow{AB} = i + 2j - 2k \quad \text{and} \quad \overrightarrow{AC} = i - j + k.
\]
The area of triangle \( \triangle ABC \) is given by:
\[
\text{Area} = \frac{1}{2} \left| \overrightarrow{AB} \times \overrightarrow{AC} \right|.
\]
Thus, we need to compute the cross product \( \overrightarrow{AB} \times \overrightarrow{AC} \).
Step 1: Compute the cross product:
\[
\overrightarrow{AB} \times \overrightarrow{AC} = \begin{vmatrix}
\hat{i} & \hat{j} & \hat{k} \\
1 & 2 & -2 \\
1 & -1 & 1
\end{vmatrix}.
\]
Using the determinant formula, we get:
\[
\overrightarrow{AB} \times \overrightarrow{AC} = \hat{i} \begin{vmatrix} 2 & -2 \\ -1 & 1 \end{vmatrix} - \hat{j} \begin{vmatrix} 1 & -2 \\ 1 & 1 \end{vmatrix} + \hat{k} \begin{vmatrix} 1 & 2 \\ 1 & -1 \end{vmatrix}.
\]
This simplifies to:
\[
= \hat{i} \left( 2 \times 1 - (-2) \times (-1) \right) - \hat{j} \left( 1 \times 1 - (-2) \times 1 \right) + \hat{k} \left( 1 \times (-1) - 2 \times 1 \right)
\]
\[
= \hat{i} \left( 2 - 2 \right) - \hat{j} \left( 1 - (-2) \right) + \hat{k} \left( -1 - 2 \right)
\]
\[
= 0\hat{i} - 3\hat{j} - 3\hat{k}.
\]
Thus,
\[
\overrightarrow{AB} \times \overrightarrow{AC} = -3\hat{j} - 3\hat{k}.
\]
Step 2: Find the magnitude of the cross product:
\[
\left| \overrightarrow{AB} \times \overrightarrow{AC} \right| = \sqrt{(-3)^2 + (-3)^2} = \sqrt{9 + 9} = \sqrt{18} = 3\sqrt{2}.
\]
Step 3: Finally, the area of triangle \( \triangle ABC \) is:
\[
\text{Area} = \frac{1}{2} \times 3\sqrt{2} = \frac{3}{\sqrt{2}}.
\]
Thus, the correct answer is option (D).