The figure of 12 million again is given without source.  As the language is similar and the date is so close, the source may be Metzer's article.  

The only sort of source for 12 million viewers is Dana White himself.  That was only the debut, and Dana didn't seem too sure.  

“It was actually 12 (million). I’m happy,The problem is down in Brazil is for some reason, I don’t know what the deal is, but networks won’t give out the ratings. They won’t tell you what the ratings were, so we know, but most of the other people have to figure it out.”

This figure was 2 years ago.  I'm not sure if the timeslot or anything else has changed. It's very common (here in the northern part of the Americas at least) for shows to take a significant hit in the ratings after debuts. Other sources put the figure at 8 million.  In any event, I'm not sure how you came to the point that many episodes average more than 12 million viewers.  That's a huge leap in logic.

That's especially confusing due to the fact that you're using present tense.  A more recent article comes from about a year ago.

http://www.bloodyelbow.com/2013/4/30/4285946/ufc-report-ultimate-fighter-brazil-cancelled-nogueira-vs-werdum-mma-news

In this article they claim viewership is around 1 million per episode.  Certainly makes more sense for a show airing at a midnightish time slot.  The number is hard to confirm, but UFC's response was telling.

"The information is inaccurate," officials said in a statement sent toMMAjunkie.com (www.mmajunkie.com). "The Ultimate Fighting Championship and Globo are happy with this successful partnership, which includes broadcasts of a few of the UFC's main events and exclusivity for the reality show in Brazil."

TUF was not cancelled, but the statement still tells us something. Now, IF TUF was actually scoring ratings in the realm of 12 million, why not say something like "Dude, you guys are fucking crazy.  10 million viewers a week mother fuckers.  Why would they cancel it?!"

Then let's combine what we know with a healthy dose of common sense and logic.  You can correct me if I'm wrong, but 12 million would be huge numbers in the US and I'd assume it would be huge in Brazil too.  Like I said, that's what Monday Night Football averages, and Monday Night Football has been the number one rated show on cable for eight years. http://tvbythenumbers.zap2it.com/2013/12/26/espns-monday-night-football-cables-most-watched-series-for-eighth-straight-year/224949/

So, I don't see how a show that airs at 11:00PM to midnight with rumors of cancellation (even if untrue) in a country with a smaller population than the US would see those kinds of ratings.  It just doesn't make sense unless Brazillians watch WAY more TV than US, and, from what I've heard, we Americans are pretty solid in the TV watching category.  Don't believe everything you read on the internet.

As for the UFC numbers, I don't know enough to comment.  I wouldn't doubt that it's more popular in Brazil than the US, but I would of course question if the popularity gap was so massive that a reality show featuring mostly amateurs in Brazil would consistently CRUSH actual pro fights by such a large ammount.  

Who is getting the 1st place instead of TUF?

The King of TV: Silvio Santos

The TUF Brazil numbers are really debatable. About comparisions with US cable ratings, just keep in mind that it isn't airing on cable here, but on free TV. But even in that way, according to Wikipedia, cable on US in 2006 reached 2/3 of the population. Since US has 300M people and Brazil has 200M, it would be actually the same number.

About popularity, I don't think is fading. People still reunite to see PPV events (usually at bars and places like that) and is a pretty talked about theme. But I call Dana's numbers BS. The timeslot is pretty terrible for TUF. Everyone works monday morning and TUF will go until 2:00AM or 2:30AM. Of course, it has some advantages. It airs right before Fantastico, that is the premier monday night program, so people may simply keep watching. The numbers could be like Dana ones in the begining of the show because Globo is by far the most watched channel here, but they probably start falling hard after less than an hour.