There's a lot of questions there.
First, the co-ords of the controller would be available from the VR API command set.
Next, the destination would be where you select - I mean, you are going to move the thumb stick around to position the target position, so you'll know where it is when you move the target around. Use a box or something temporarily.
Assume now then, that you have 2 XYZ co-ordinates. You need to make a curve effect to the destination (much like I think in Robo Recall?)
For the arc visual part, you could make a segmented poly object using quad polys, (or a pipe) where you could mathematically alter the vertex data based on a spline or bezier.
If you use 3D physics, I seem to remember some functions there which could allow for simulating rope/chain which you may be able to use.