I'm currently running a large UltraPeer for Limewire (by virtue of
LimeWire "electing" me to be an Ultra Peer). Also, I have about a
Terabyte of free hard drive space... the server is unused, and we have
to ride out our contract with our internet service provider, so the
bandwidth is pretty much unused as well.

I was thinking, a great feature to add in would be the ability for
users to select whether or not their LimeWire installations are
"caching" servers. By this, I mean, you could write algorithms that
detect the most requested files by scanning the search stream and
transfer activity (in much the same way you select files for "what's
new"). Then, I, or any user who opted to be a "caching client", could
opt to download those files locally and then reshare them.

It would mean that popular files would automatically be populated
throughout the limewire network and would benefit most all users
because the chances that a "close" caching server will contain the
files they're looking for will be very greatly improved.

Currently, the entire architecture is in place, and I can simulate
this functionality by downloading everything in "what's new". I'd
like to not have to perform this manual process however.

I suppose, for its first iteration, it could simply boil down to automatically running the "what's new" query every so often, and automatically downloading everything.