I guess a lot has changed down there since the early 1990's.
I spent the better part of a year driving, surfing, and wheeling, while on the way to Costa Rica and back... and spent at least half our trip on dirt/mud/sand tracks of all kinds.
If you want to hit jungle tracks, drive on the beach, and be able to go where ever you want, take the 4x4...you'll be glad you did.
One advantage of the VW in South America is the local clubs. If you are so inclined you can meet local VW owners who will treat you as an honored guest. If you have mechanical problems they can tell you the best mechanics to take care of any problems.