I'd suggest to keep in mind the song 'Pidmanula Pidvela' which can be easily found on English Wiki. https://en.wikipedia.org/wiki/Ty_zh_mene_pidmanula It gives really nice and natural preposition combination in every quatrain :)
Why is "в" correct and "у" isn't? Are they not interchangeable? Until now i've just used the former for words starting with vowels, and the latter for words starting with consonants (i suppose for the same reason you would in english say "an apple" instead of "a apple", because it sounds and speaks better not to jam vowels together).
In any event, are there any specific instances when to use "в" instead of "у" and vice versa? I'd even want to extend this question to incorporate when exactly to rather use "на". But i've asked that one a few times, and the ukrainians i'm living with can't elaborate further than saying they "just know" when to use which. This particular question of when to use в/у/на has so far been the most problematic issue for me to overcome. It seems apart from basically memorizing which words go with which one by one, there is no particular rule that can be referred to when coming across new words or places to be "at/in/on".