However, on a different note, low pressure and temperature steam that is "saturated", which is what our toy steam engines operate on, actually does provide a modicum of lubrication, in that there is constantly a fine "skin" of water coating all the surfaces within the cylinder.
In a real steam engine operating at high temperatures and pressures, there is no such water in existence within the cylinders, as the steam is actually "dry" in that situation, besides which the forces involved in such an engine would far outstrip the meager lubrication ability of water, which can only work as a rather poor lubricant when there are no significant forces involved.
If you are running at just an atmosphere or two of pressure, you are likely fine.
Hope that helps.
I've been using air tool oil on the working parts, and not the cylinder.
And for what steam engine I'm using it on, look to my profile photo, very small oscillating engine. (though I have a Schoenner coming soon)