He loses the ability to cause repulse, but he becomes a character that u can actually use for combos. A very versatile one too considering he chases knockdown and creates high float.

He becomes a "transitional" character as i would like to call it. He can create high float with standard, chases a knockdown and create high float again. Works very well with lee. as he should.

No it's not a typo, but it's not a loss, it's a trade and a very good one at that. He looses repulse but he also looses battlefield cooldown on mystery, his standard attack gets upgraded and he gains a chase.

As for his usage, he has a lot to offer. His mystery is amazing in survival and vs annoying pve levels, because it's basically point and click cancel enemy move. Put him on your move 1 position and give him some initiative and he counters the very popular Hinatas/Gaaras/Lightnings with their aoe paralysis.

Team comp wise, his chase is same as Kabutos so pretty much all the Kabuto teams you see will work with Neji for example Neji/Kakashi/Hinata.

Neji isn't the only one who changes at a potential loss.

Gaara loses his ability to chase twice going from 1 to 2 stars but gets stronger powers.
Sasuke gets a more expensive jutsu and loses the Curse Mark ability in exchange for more combo power.

There's others I'm sure as well but not every character is a straight upgrade. In fact two years ago when I played this game in another version it was common meta to NOT upgrade Sasuke because 2-star Sasuke worked better with certain combo teams at the time.