The injuries of players that continue to befall the Madrid squad at the moment, greatly affect their performance and game, the injuries of some key players have made them lose their consistency and strength, what you say I think is quite true, the 2 defeats they got in the UCL this season have shown their performance has declined drastically, let alone the defeat they got was from a team weaker than them, So Ancelotti should start trying to find the solution from weaknesses of his current team, because if not then it seems that we have to exclude them this season as the favorite teams in the UCL this season
It not only affects the Champions League but will also be a problem when Real Madrid competes for the La Liga title this season. The defeats to AC Milan and Lille are inseparable from Real Madrid's lack of consistency which was caused by injuries to several players so that their performance has decreased much more. Ancelotti must think of a way to make changes because injured players may be absent for a long time so he must find a solution.
The match against Liverpool will be much tougher because currently Liverpool's strength is much more stable. The match will also take place at Liverpool's home ground so Real Madrid will certainly be under much greater pressure, although mentally I am sure Real Madrid is much better.