New radio telescope arrays are currently being contemplated which may be built using hundreds, or even thousands, of relatively small antennas. These include the One Hectare Telescope of the SETI Institute and UC Berkeley, the LOFAR telescope planned for the New Mexico desert surrounding the VLA, and possibly the ambitious international Square Kilometer Array (SKA) project. Recent and continuing advances in signal transmission and processing technology make it realistic to consider full cross-correlation of signals from such a large number of antennas, permitting the synthesis of an aperture with much greater fidelity than in the past. In principle, many advantages in instrumental performance are gained by this 'large-N' approach to the design, most of which require the development of new algorithms. Because new instruments of this type are expected to outstrip the performance of current instruments by wide margins, much of their scientific productivity is likely to come from the study of objects which are currently unknown. For this reason, instrumental flexibility is of special importance in design studies. A research effort has begun at Haystack Observatory to explore large-N performance benefits, and to determine what array design properties and data reduction algorithms are required to achieve them. The approach to these problems, involving a sophisticated data simulator, algorithm development, and exploration of array configuration parameter space, will be described, and progress to date will be summarized.