General expectations of a project (It is quite reasonable to deviate from these, but check with me first):
Projects are expected to be the work of one or two students. (I usually encourage two but this year connections are tougher to make. Feel free to email your classmates to find a partner … either before or after you decide on a topic.) Expectations for two person projects will be appropriately higher than for a single person. If you would like to do something for academic credit beyond this course, this is possible provided all parties involved are appropriately informed and agree. This could be projects in two courses taken concurrently could be closely related or a portion of a thesis.
A particularly good starting place is Space-Efficient Data Structures, Streams and Algorithms LNCS 8066 (otherwise known as "Ianfest"). Many/most of the articles are fairly easy to read surveys with lots of great references.
A more direct approach is to try fairly recent conferences and journals, say from the last 3 years or so. Most papers are accessible when logged on from the university: (Only a modest fraction of the papers in any conference or journal are relevant to this course. Conferences have a 2 to 3 year lead on journals, so try the following conferences)
Conferences and journals also vary in average quality. SODA is very strong by both metrics. STOC and FOCS are very high quality but also rather broad in scope.