Electric Guitar Effects Analog/DSP Senior Project

Hey guys I'm looking for ideas for my senior project this year. I wanted to due a purely analog distortion circuit that I could fit in the body of my electric guitar and feed to an internal headphone amp so that you could use headphones plugged directly into the guitar, but my professor thought it seemed a bit to "Radio Shack." He suggested instead to try the DSP route. I have a Digilent Nexys I FPGA board with a Spartan 3 and was wondering if you guys knew anything about some signal processing that could be done with this board in the realm of guitar effects. Distortion, delay, etc. I know they sell A/D and D/A converter attachments, I'm just not sure what kind of processing this board could handle or what DSP code looks like. I've taken a few digital design classes and used vhdl as well as C for microcontrollers but I feel I don't know much about DSP. Any hints/ideas/suggestions you guys can throw at me? Thanks

Nexys I
http://www.digilentinc.com/Products/Detail.cfm?NavPath=2,400,797&Prod=NEXYS