Just a couple of changes were necessary.
Change to the handling of the enter/update selection:
var rectangle = svg.selectAll("rect")
.data(dataset);
rectangle
.enter()
.append("rect");
rectangle
.attr("width", 20)
...
Change to the placement of the SVG element outside the slider handler.
Complete FIDDLE.
NOTE: the current height of the SVG element is not sufficient to see the magnitude of changes allowed by the slider. You should increase that, say attr("height", 200)
.
Another FIDDLE responding to the slide event and thus making the change to the rect's height more pleasing to the eye.