I am an A2 media student and I have to say I agree with what Odd socks is trying to say. I doubt my media teacher would approve this and he definitely wouldn't come up with it. As you have said it was your teacher's idea, so it's not your fault but the point of media studies is not only to learn about how media texts are produced but also to analyse the representations of certain issues and groups of people in society. I think a better idea would be to make a film which challenges negative stereotypes of people with mental illness.
Also, being possessed by a spirit is to do with the supernatural, which we have no proof of being real, while mental illness is a real thing so you are getting the two mixed up. Having a mental illness is not like being possessed and this film idea sounds like it will just reinforce really negative and uneducated stereotypes of mental illness, which is the opposite of what media studies is about. Unless you were going to say in your evaluation that you purposefully reinforced stereotypes and discuss this, I would advise you to stick with the mental illness idea but subvert the stereotypes! I expect this is what your teacher was thinking of when they suggested it.
Although it may seem like we are being a bit pedantic and taking it too seriously, we are just giving our opinions like you asked. And yes, your media project is not going to be "published around the world" but that's not the point. The point is that media studies is about taking a critical view of media and understanding how it represents people and influences society, so having the attitude that it's 'just' a media project and not to be taken too seriously doesn't really fit with the point of doing the A level, if you see what I mean?
I think that despite what your teacher says you will get a better grade for challenging stereotypes and demonstrating that you understand that mental illness does not equal 'crazy person who kills people'. Anyway, I understand that the idea wasn't yours so I'm not trying to lecture you or anything, I'm just trying to advise you on how to get the best grade, and I know that coming up with ideas for film projects can be really hard! I hope you figure it out and manage to get a good grade. Good luck