He is not a back up option - and he will not go to a club where he is one. Then he can stay at Bayern. He will choose a club in which he will be a starter - with Scolari he is a starter in the Brazilian World Cup team at the home World Cup and he does not want to risk that. I guess he prefers to play CL or EL, but when that does not function Wolfsburg is not that bad option as he will stay in the Bundesliga and in his team with Diego and Naldo there is two other Brazilians playing that Scolari watches.
At Bayern the problem is that Guardiola does not plan with a defensive midfielder at all. A lot of us would like it if he stays as we doubt that will work too good - and then there is no defensive option apart from Martinez available, especially when Schweinsteiger is injured you need to change the system as both Kroos and Thiago will need a defensive cover. Last year Gustavo was used behind Martinez and Schweinsteiger - and Heynckes used him in about every match when he was matchfit. Even if he was the backup he still got 37 matches (and missed about 8 to 10 because of an injury) and got more than 2000 minutes match time.
If Bayern would have known how Gustavo develops in the last year - he always was great in the defensive ways, but when you look at the youtube video posted you see that in the last year he has shown a lot going forward, too - they would not have bought Martinez.