Dude,

The year-round spring with good flow definitely puts you into a good pond situation.

You say your soil is almost all clay, but the presence of a good spring indicates that there is at least one permeable layer of material in your subsoils. I suspect you have at least one layer of sand or gravel on your property. That is the layer you will need to cut off and effectively seal for your pond construction.

A properly constructed core trench will do that in the straight down slope direction. It will also anchor your dam in place, which is very important in your situation since you are building on a slope.

Based on your question about a curved dam, I assume you have realized that you will need a berm or levee on the sides of your pond where the impounded water level will be above grade. You will probably not need a core trench in the areas where your levee is only a few feet high. However, you will need scarify the soil below your levees to tie your levees to the original ground surface in a way that will seal against horizontal water flow. Also, if there is a permeable, sand layer in your pond site, then you must also cut and seal that layer so that impounded water will not flow laterally into that layer and then around your dam. Additionally, you will either have to do lifts and compaction in the center of your levees as you build up (like a core trench), or finish with a 12" clay blanket to seal the pond side of the levees. (That might be easier and cheaper since two 6" compacted lifts would be sufficient for the low parts of the levee.)

The worst case scenario (wild speculation on my part) would be if the sand/gravel layer became even better developed at the site of your pond. Geology in the real world is seldom uniform. Springs frequently flow water at the surface due to a restriction in the permeability of the layer transmitting the water. To expand on esshup's bathtub analogy above: the spring at a higher point on your hillside, could have the capability to flow at the rate of a 10" water main. If the permeable sand is restricted down to the equivalent of a 1" pipe near the location where your surface spring flow occurs, then the excess water comes to the surface and flows over the top of the restriction. Just like a dam in a surface stream when the water inflow rate exceeds the flow rate of the spillway pipe. I only point this out, because it is possible for you to construct a pond that leaks more than your spring inflow rate. Especially if the sand layer at the location of your pond turns back into the equivalent to a 10" water main.

Hopefully, the sand layer that supports the spring above your site will be readily apparent at your site during excavation of your pond. If you properly use standard sealing protocols with your good clay, then you should have no problems!

Finally, wet clay is no fun to work with during the excavation phase OR the sealing phase. Is there any way to build a spring box or pool up near your spring and use corrugated flexible drain tile pipe to divert the water around your pond site? (The 4" pipe is only $0.54/ft when it goes on sale at our local Menard's.) If you can do the diversion, that may save you many, many hours during the construction phase. You could even divert for six months prior to construction to perhaps even reduce the water in your subsoils a little.

Good luck on your pond project! A pond with a crescent dam, nestled at the bottom of a hill sounds like it could be a real beauty.