...courses _should_ do.
So it depends at what level you were at when you encountered this. I really don't think trying to get students to do one massive project in a first year class is a great idea given that some people may just be learning.
But later on, second year even, by all means, develop a larger project.
The biggest problem is coming up with a project, like you say, that explores all of what you want to teach. If you choose poorly, you may not find the ability to teach the value of hash tables, or graph algorithms, or different kinds of trees, or reasoning out mathematical patterns, without hacking it into the project in a haphazard way anyway.
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