Just click "See Inside", and put the pointing block into your backpack.
You can only point at sprites, so if you want it to point at the mouse pointer, you'll have to make it point to a sprite following the mouse pointer (like what I did). For the final two inputs, keep them as the x/y position of the sprite. Unless you have a custom x/y position system, though. When strict mode is on, the pointing is much more accurate, though is not as smooth. When it's off, it's the opposite. Smooth, but not 100% accurate. This pointing engine can get really wonky around the edges.