Simply stated, this is a bad matchup for Chile. They needed to draw a team less familiar with their unusual 3-3-1-3 formation, but instead they got a neighbor. Make no mistake, Chile are very good, and very fun to watch with their funky attacking formation (cfb analogy would be Leach at Texas Tech or a version of the spread), they just got a bad draw. Chile have only beaten Brasil 7 times in their 65 meetings, and Brasil have won 7 in a row.
Chile did well in CONMEBOL (South Ameican) qualifying, finishing 2nd with 33 points from 18 matches, 2nd only to Brasil who had 34 pts from 18 matches. The problem for Chile is that in their 2 head to head matchups, Chile got bossed, losing 0-3 at home and then 4-2 in Brasil.
Going back a little further, Chile got annihilated by Brasil 6-1 in the quarterfinals of Copa America 2007. In 2006 World Cup qualifying Chile lost 5-0 away to Brasil but did manage a 1-1 draw at home en route to finishing 6th and not qualifying. To be fair those results were under a different coach and system then they currently employ.
Based on that and what I have seen so far, I expect a fairly comfortable Brasil win. And better yet for neutrals, if Chile go for it with their funky attacking 3-3-1-3, we could see a marvelous back & forth exciting goal fest, something in the neighborhood of 4-2.