New generation of AI coding tools, including AI-powered IDEs equipped with agentic capabilities, can generate code within the context of the project. These AI IDEs are increasingly perceived as capable of producing project-level code at scale. However, there is limited empirical evidence on the extent to which they can generate large-scale software systems and what design issues such systems may exhibit. To address this gap, we conducted a study to explore the capability of Cursor in generating large-scale projects and to evaluate the design quality of projects generated by Cursor. First, we propose a Feature-Driven Human-In-The-Loop (FD-HITL) framework that systematically guides project generation from curated project descriptions. We generated 10 projects using Cursor with the FD-HITL framework across three application domains and multiple technologies. We assessed the functional correctness of these projects through manual evaluation, obtaining an average functional correctness score of 91%. Next, we analyzed the generated projects using two static analysis tools, CodeScene and SonarQube, to detect design issues. We identified 1,305 design issues categorized into 9 categories by CodeScene and 3,193 issues in 11 categories by SonarQube. Our findings show that (1) when used with the FD-HITL framework, Cursor can generate functional large-scale projects averaging 16,965 LoC and 114 files; (2) the generated projects nevertheless contain design issues that may pose long-term maintainability and evolvability risks, requiring careful review by experienced developers; (3) the most prevalent issues include Code Duplication, high Code Complexity, Large Methods, Framework Best-Practice Violations, Exception-Handling Issues and Accessibility Issues; (4) these design issues violate design principles such as SRP, SoC, and DRY. The replication package is at https://github.com/Kashifraz/DIinAGP