Here is how it works, a certain guy/group comes up with a theme for the week, then users start to make scratch projects following that theme. Then they upload the projects and the projects get voted on.
Example: A sticky for SOTW 1 is made. The theme and further rules are in the first post of that topic. Then, all the way down, is people entering their projects. After 5 days have passed, users will vote on which project is best.
I think the hardest thing would probably be voting. Usually when I see forums with things like this, they have polls. I'm not sure if this place has polls, I've only been here for 1 day.
As a guy always looking for a new challenge, I like to "Compete" and I know somebody else does too. Not only does it touch up on your scratch skills, whether you win or lose, but it's a lot of fun!
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One problem is that a lot of people will complain that they lost... This site is full of young children... Bringing a well known site wide competition into it will cause problems.
And this is sorta (without voting) what design studios are for.
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