Welcome to the Craft community. You try to create a new section for each project - right? In my opinion this is only necessary if you need different view and edit rights on each project. If you'r creating a "open for all" project documentation tool (open means for only one user group), than i would go with a single section. It's much easier to manage and starting with a new project. I would use two entry types in the section (https://craftcms.com/docs/sections-and-entries#entry-types). One entry type is for the project and one is for your chapters and the content.
Example:
1x Section called "projects"
1x entry type called "project" with following fields (example)
- name
- project description (rich text field)
- project team (user field)
- release date (table field with date and description)
- ...
1x entry type called "chapter" with following fields (example)
- name/title
- content (richt text field)
- images (file field)
- documents (file field)
- ...
Finaly you "project" section would be like this:
Project 1 (entry type "project")
- Chapter 1 (entry type "chapter")
- Chapter 1.1 (entry type "chapter")
- Chapter 1.2 (entry type "chapter")
- Chapter 2 (entry type "chapter")
- Chapter 2.1 (entry type "chapter")
- ...
- Chapter ...
Project 2 (entry type "project")
- Chapter 1 (entry type "chapter")
- ...
For creating the dropdown-navigation, you can simple use the nav tag (https://craftcms.com/docs/templating/nav). Instead of a use option tags for output:
{% set entries = craft.entries.section('projects').level(1) %}
<select id="nav" onchange="if (this.value) window.location.href=this.value">
{% nav entry in entries %}
<option value="{{ entry.url }}">{{ entry.title }}</option>
{% endnav %}
</select>
For the subnavigation you could take a look on this Craft recipe -> https://craftcookbook.net/recipes/fully-dynamic-hierarchical-nav-menu-template.
Other solutions:
Depending on how many content is used in each chapter, you could also make use of a matrix fields for your content...
Doe's this make sense for you?