I think your idea of doing a reading project is excellent.
Think carefully about your choice as you are going to be spending a lot of time working on it and you want your students to be motivated. When introducing it in class, you can show them the cover, describe images or scenes from the book and get them to guess the genre (love story, horror etc) and what happens. This will whet their appetite.
You should follow the principles for any reading activities including warming students up to the topic, pre-teaching necessary vocabulary. The book can be split into sections and each section is read quickly to get the gist and then in more detail. Then do follow up work, discussion or some of the ideas below.
Here are some activities you can do around the book:
You can choose two or three themes to develop, for example, family ties, growing old, town versus country. These themes can be used to work on speaking and writing and to develop vocabulary.
Choose something that happens in the book but which is only referred to briefly. For example, after going to the shops they went for a coffee or someone accepted to help another person. Take this scene and have students imagine what was actually said, where it happened etc. They can then write out the dialogue or role play it directly, if their spoken English is good enough.
Choose a character and develop him / her to fit your country, time etc. If you are reading a historical novel, students could imagine how the person would be in our time and age. Or if the book is set in London, they could imagine how the character would behave in the country where you're working.
After studying a section of the book, you can prepare a crossword puzzle or a word search to revise vocabulary. When the students are used to the book and the activities, they can prepare the puzzles in groups for classmates to solve.
Students can draw a picture of their favourite scene, character or the village (etc) where the book is set. This activity takes the focus away from the written word and gives students a chance to show what they understand in a different form.
After reading a section, you can give them three written summaries, only one of which is correct. They decide which is correct. Alternatively, you can read it out to them to practise listening skills and to take the focus away from the written word.
After reading a section, they can write a summary. It would be demanding to summarise the entire book. You can help them by giving the first sentence of each paragraph and providing an outline for the rest of the paragraph.
You can write quiz questions for the students based on the book. They can also write quiz questions in groups and then test classmates.
Students can pick a character - or be given the name of one randomly - they imagine what the person was doing and what (s)he was like 10 years ago. They could also describe a typical day in the life of this person. This can be written or done orally.
I’m sure you and the students will enjoy working on the book. I'm not quite sure what the other part of your question is about reading activities. If you send me some more details, I'll be happy to answer.