is "Undergraduate Capstone Open Source Projects", a program whereby undergrad (and grad) students from universities all across Canada can work together in distributed teams on software development projects for course credit. It's running again this fall with backing from O'Reilly, Google, and the Canadian Association of Computer Science, and back in July, Andrew Louis (one of the organizers) went to OSCON, the major annual Open Source Conference. His blog post
describes what he learned there about efforts elsewhere to get more open source into CS education; there are lots of good pointers, and plenty to think about.
One of my few regrets about leaving academia is that I won't be working as closely with students on things like this as I used to---it was always tremendously rewarding. If you'd like to be involved as a student, a project mentor, or an academic sponsor, please head over to the UCOSP site
and get in touch. I promise you'll be glad you did.