How can I select really nice project ideas for undergrad research projects?
If you want to do projects related to your courses, I wouldn't push towards recent literature.  It will be specialized and the emphasis will be on new ideas, not on implementation of your course learnings.

Instead I would look at the references in your texts (often older/harder books).  They may have harder exercises or have small design projects.  

Also, of course, talk to your teachers.