Yes, that's true, on a good day Croatia can win just about any team. But you're looking only one side of medal.
For example, in 2007 Croatia won over Spain, yet lost to Latvia. Lost to Israel, but won France.
Same could happen now, maybe win over Slovenia or Russia ... but also maybe loss to BiH or Macedonia.
With two big differences:
1) System is tricky now. Before it was 3 of 4 teams progresses to 2nd round, now 3 of 6 teams progresses. You lose one game you "should win", and (if tiebreaker is not good for you), you don't get to play Slovenia or Russia in 2nd phase.
2) Before we had good coaches, now we have joke of a coach. If opposing strong team has bad day, still we almost surely lose close games (example vs Serbia 2010)