Connection of the circuit breaker
Circuit breakers are always found at the location where the size of the wire changes. For example, when wiring enters your house and splits off to your lights and outlets the gauge of the wire is reduced to make running that wire more practical. When the gauge of the wire is reduced a circuit breaker is installed. This is evident in the circuit breaker panel of the house. The reason for this location is because when the size of the wire is reduced the safe current capacity is also reduced. If the circuit into your house is 400A capable, the wires in your walls could glow red hot and not blow the 400A fuse on the electric pole outside. Therefore the breaker is sized in a way to protect the wiring. 

The circuit breaker is always on the hot side. The neutral line is just a return line. If the circuit breaker was on the neutral side then only the wiring from the breaker to point were the neutral wires all tie together would be protected. This is because a circuit breaker is meant to protect not just form over current but also against a short to ground. If a short were to occur on the hot side then the current would bypass the breaker on the neutral side. Further if the breaker was on the neutral side and turned off, everything else would still be electrified. When the breaker is on the hot side and is turned off only the bus bar inside the panel remain electrified.