I have been teaching graphic design since I started my teaching career 6 years ago.
My favourite project has always been designing album covers. The students love it and really take ownership of the project as they get to pick the artist.
At present we are using Adobe Firework to create the album covers. Images are edited, combined with several other images, then text and layer effects are added. My plan this year was to use Photoshop, but after we upgraded to the latest software we had a few issues (which have now been resolved) so I stuck with Fireworks.
Next year we shall use Photoshop, although the design principals are the same whatever application you use.
Here are few examples, there is some amazing work here and I wanted to share it.