The wisdom of the crowd can bring together a little bit of information from each and every person to provide a useful and meaningful answer. Averaging out who is topping everyone's brackets is a good indicator of who will win the NCAA Tournament. Some bracket builders follow statistics of teams and individual players. Others consider sports history and still others go on gut. Bringing together all of this information gets to the right answer.
NCAA brackets do pick the eventual winner. When one submits a bracket he must choose the winner of each game through the championship match up. While it is nearly impossible to pick the correct winner for each game, in many cases the public do get the eventual champion correct. While filled with upsets, the tournament normally features the best teams in the final four.
Yes, I think that tournament brackets predicts actual winners because the majority of the team that makes it to the Elite Eight and Final Four are the top ranked teams. Although the first and second round of the NCAA tournament is always filled with major upsets, at the end of the day the majority of the teams that end up winning are teams that are expected to be in the mix to win it all.
NCAA tournament brackets do not predict actual winners because they are merely gases by people seeking to win money. Although many people use statistical analysis and other means to predict winners, brackets alone are not indicative of what team will actually win the NCAA basketball tournament. Like other prediction aids, brackets are just a tool among many to help protect winners.