As LLMs reshape software development, integrating LLM-augmented practices into SE education has become imperative. While existing studies explore LLMs’ educational use in introductory programming or isolated SE tasks, their impact in more open-ended Project-Based Learning (PBL) remains unexplored. This paper introduces a two-year longitudinal study comparing a 2024 (using early free LLMs) and 2025 (using latest paid LLMs) cohort. Our findings reveal the latest powerful LLMs’ dual role: they act as “equalizers,” boosting average performance even for programming-weak students, providing opportunities for more authentic SE practices; yet also as “amplifiers,” dramatically widening absolute performance gaps, creating new pedagogical challenges for addressing educational inequities.