projection of 3d objects on terrain

This is what I need right now

http://img839.imageshack.us/img839/3543/adwd.jpg

sorry for the quality, this is a .005f high cuboid with a texture. It’s center is always on the same height as the terrain below this point. Sadly it cuts through terrain.

What I want is an object which will cover the terrain, but when you look at it from above you will see it’s true shape (and the graphic attached to it). Think of it as a area of effect spell marker, in my case it shows the place where building will be erected.

Have you already checked out the Projector functions? If so, do they not perform the way you’re describing (I was under the impression they did…).