Silicone-wise I would take a trip to Lowes, Home Depot or somewhere similar and grab a tube of "GE Silicone I". Avoid the Silicone II as it has mold & mildew inhibitors in it that can harm your tank inhabitants. The package for Silicone I may say not to use it on aquariums or food preparation areas, you can basically ignore that.
GE's official support department's opinion on this matter is that "none of their consumer grade silicone products are rated for underwater use". They suggest either GE RTV108 or GE IS808 but will then come right out and tell you that "GE Silicone I" and "GE Door or Window Silicone I" are equivalent products. Only the packaging differs from the commercial product (which we can't readily get).
As far as wood goes, I would find some WELL aged hardwoods (Oak, Maple, Etc), avoid soft woods such as pine. If at all possible take a trip to a beach and go through the drift wood and look for drift wood that still has a somewhat glossy finish even though most of the color is bleached out. If the surface seems soft or looks like it's been slightly shredded and you can see / feel fiber, it's softwood.. leave it on the beach.
You could also take a trip to local pet stores and look through the Mopani wood they keep in their reptile department. This wood is GREAT for aquariums and sinks without soaking it for weeks to get it waterlogged like you'd need to with most wood.
How? That's up to you.. be creative, check out other people's DIY projects here on AC, youtube videos, etc..
Just my $0.02
Ric