News sources are generally reliable, but be sure to stay away from "gossip" media which often contorts the truth.
They just want to see that you can work on and complete a big project.
You'll want to write about a topic or subject you're fairly familiar with.
The point matrix is outlined in the "Diploma Points Matrix for the Extended Essay and TOK" grid in the IBO form.
You can still get your diploma if you get a "Mediocre" on one and an "Elementary" on another.