I don’t think it matters what it’s called. I picked config years ago because it bubbles up to the top of a list of folders/files, it’s not clever, and it’s mentally easier to remember in big projects than {app_name}_project like everything else I had worked with leading up to it.
One could argue that project is a better name because you create it with python manage.py startproject. I think calling your web app “project” would be more confusing for new people because most people don’t even know what a project is. Most IDEs have a completely different set of opinions and features for projects as well, which doesn’t help.
In a perfect world, I would rename/merge startproject and startapp into one command, and I would call my default app+config just app, but going against ~16 years of Django material, so that’s out.
If you work on more than one project, I recommend standardizing one config folder name for all of your web applications/projects. Bonus points for being sort friendly so that it’s easier to locate.
In the medium to long term, I think standardizing to one config/project naming scheme is better because it makes copying and pasting configs between projects less problematic for people.
When in doubt, use config until you can come up with a better name.