Selection color for gvim is set by the following line:
hi Visual guifg=#000000 guibg=#FFFFFF gui=none
You can use named color values instead of the #nnnnnn RGB codes. Your existing line is set for black foreground and white background, just as you observed.
For example, if you want a light blue background with white foreground:
hi Visual guifg=White guibg=LightBlue gui=none
Be sure the color file you are editing is in the vim7x/colors directory so both vim and gvim can find it. Its exact location can vary a bit depending on your OS platform.