The trouble with Brazil is that they're a team too reliant on an individual; Neymar. While under-par teams relying on particular individuals can go far in the WC (and have in the past) it's extremely rare they go on to win the competition - furthermore Neymar's still growing as a player; he's not really at his peak. It's a bit much to expect him to do everything, especially considering Brazil's attacking options seem so poor. Alves' and Marcelo's offensive game is not what is was (despite Marcelo coming off the back of an impressive CL final performance), Brazil have gone from strikers/midfielders such as a Pele, Ronaldo, Rivaldo, Romario, and Ronaldinho, to the likes of Fred and Jo; which says it all. They are really suffering from a lack of a creative midfielder, more than anything.
I still expect them to go to the round of 16, but if they're going to progress a miraculous improvement is needed.