Sounds like fun.
Just some observations/thoughts though, not poopooing the idea at all.
Maybe pick a real world problem/idea and take it from there. What I mean by that is pick something that is commercially available, say, and throw it open to interpretation.
I'm not explaining this very well, I appreciate, so I'll use an example.
Boiling an Egg. Timing is critical for the "perfect" egg. Perfect being that it's down to a persons own choice.
The outcome project could be anything as simple as a light/buzzer that comes on after a user specified time period, down to using temperature sensors and some form of mass sensor (boiled eggs are less dense than raw or is it the other way around, I forget)
Rather than specifying components to be used, make the specification part of hte challenge. So use 2 inputs and have at least 2 methods of verification of boiled'ness.
The finalised circuit could be as complex or as simple as the user needs, and thus inject a lot more creativity.
Back to your knife forum example... I'm sure some knives were quite simple, functional affairs and others elaborate. The end project was the same though. Make a knife useful by adding the means by which to hold it, the forummers took that idea and made it their own.
Great idea though, and I'd be up for taking part