Sounds like a good idea. Making it like the current bi-weekly competitions (PRC and MnP) in that the winner chooses the next rounds vst would probably draw more people in; having to choose for themselves can put some people off (myself included).
Would you make this an actual remix competiton or would it be an original compostion? If it's a remix does it have to be an actual remix (like PRC) or would MIDI-rips be allowed (like MnP)? Also, if we're going down the remix route, would the winner choose a source as well as the vst? Or if it's an original piece maybe they could choose a theme instead (like the One Hour Remix compo).