I suggest you start by considering how much time you have to devote to the project first. You don't want to start something that you can't finish in time. Since this is for school, I don't know if going for "challenging" is the right way to go. If it were me, I would go for something where I could showcase the practical implementation of various concepts that I have learned. Video rental business, car reservation, hotel reservation, library system, inventory system, accounting system... doesn't really matter, IMO. You probably don't have much time to spare so why waste it by agonizing over finding a "challenging" project? Just pick something and get to it.