Comment XNA Game Studio and Sprite Effects (Score 1) 172
I would suggest XNA Game Studio: http://creators.xna.com/en-US/
There are plenty of examples for you to tear apart and modify with the class. Everyone could create their own alien ships to destroy or something.
Programming, however, might be a but much for art students. If I were you, I'd go for texture implementations like model skinning (both world objects and character animation), 2d textures for menus, and sprite effects - how transparency comes into play, 3D space and z-order, and post processing effects like lights and such.
They you go.
-Mike