How to update UI image position

Good Day! I am attempting to make a script in which I can select from different blocks using the scroll wheel, that part works however I cannot figure out this GUI nonsense to go with it. I have an image serving as the pallet and two images on top of that to show what blocks are available. When I scroll I want a selection image (a green outline) to appear on the currently selected block. I am getting furious as I cannot make this work and the Scripting API/manual is not making it very clear on how to interact with UI elements via a script.

Here is my script to switch blocks and to create them when I click

using UnityEngine;
using System.Collections;
using UnityEngine.UI;

public class TileController : MonoBehaviour {

	public Transform Brick;
	public Transform Dirt;
	private Transform block;
	public Transform Selector;
	public Transform SelectorParent;
	


	// Use this for initialization
	void Start () {
	
	}
	
	// Update is called once per frame
	void Update () {
		
		if(Input.GetAxis("Mouse ScrollWheel") > 0f) //forward
		{
			block = Brick;
			Instantiate(Selector,SelectorParent);
		}
		else if (Input.GetAxis("Mouse ScrollWheel") < 0f) //backward
		{
			block = Dirt;
		}
		
		if(Input.GetButtonDown("Fire1")) {
			Ray ray = Camera.main.ScreenPointToRay(Input.mousePosition);
			RaycastHit hit;
			if (Physics.Raycast(ray, out hit))
			{
				Instantiate(block,hit.point,Quaternion.identity);
			}
		}
		
		
		if(Input.GetButtonDown("Fire2")) {
			
			Ray ray = Camera.main.ScreenPointToRay(Input.mousePosition);
			RaycastHit hit;
			if (Physics.Raycast(ray, out hit))
			{
				BoxCollider bc = hit.collider as BoxCollider;
				if(bc != null)
				{
					Destroy(bc.gameObject);
				}
				
			}
		}
	}
}

I am aware my code is probably not the most efficient as I am still very much a noob! I used the SelectorParent to define the pallet image in which the Selector image should appear on. If there is a better way to update UI elements rather than instantiating and destroying them, please show me!

Basically I am going for the same effect as when you select a block in… you guessed it… Minecraft… (They won’t sue me for using their game as inspiration will they?)

Any help is greatly appreciated as I am really trying not to freak out and smash my keyboard here!

Bump! Anybody out there?