We report further molecular dynamics simulations on the structure of bound hydration layers under extreme confinement between mica surfaces. We find that the liquid phase of water is maintained down to 2 monolayer (ML) thick, whereas the structure of the K(+) ion hydration shell is close to the bulk structure even under D = 0.92 nm confinement. Unexpectedly, the density of confined water remains approximately the bulk value or less, whereas the diffusion of water molecules decreases dramatically. Further increase in confinement leads to a transition to a bilayer ice, whose density is much less than that of ice Ih due to the formation of a specific hydrogen-bonding network.