This is a cool idea...
I'd REALLY like to see the Carolinas do something like this as well. We have numerous user groups.
(It's funny... GC.NUG is doing the Open Source Mobile Game Programming Expo, which ends in July. When we first came up with the idea I wanted to include other Carolina groups to make it a bigger event and more fun. The primary opposition to that suggestion ended up dropping out of the contest after a couple months, quitting the company I work at and moving to Texas. I wonder if he's participating in this?)
Maybe our next big contest will be open to other groups... like I wanted to all along. :)
Question is... what should it be? I don't necessarily want to do compact framework again, so maybe a windows app or a web app. It probably won't have a “just games” focus. Maybe we could have two categories... 1 for business and 1 for fun... and the platform could be left up to the entrants. The only qualifiers would be that it has to be written in a .NET language (can use any of the frameworks) and that it's something NEW. Not an app you sold 2 years ago and modified. Like the DNO site says, if you ever got money for it, or released it publicly then it isn't eligible.
While I'm on the subject, this seems like a good time to mention I've registered http://www.carolinausergroups.com (and .org). In addition to collaborative competition and area news, I plan for the site to also offer a way to get some exposure to the various user groups in your area that you may or may not know anything about. As well as a forum for UG leaders (and UG members) to talk and share ideas.
The site is not up yet (or even close to being ready) but it's one of the top items on my list of projects. Now all I need is a webhost willing to donate some space in exchange for some free advertising and a DNN 3.0 install.