I use both mutual funds and ETFs. I like to use ETFs in my taxable account because there is no taxable gain until I sell. I simply have to keep it for over a year and the cap gain becomes long term capital gain, so I'll pay less tax. Both MFs and ETFs will throw off dividends, so those are taxable and you'll get that right from the start. But after a year, they're qualified dividends. I am not sure if it's different for mutual funds but I don't think you have control over that like you do with ETFs.
To answer your question......sure. I'll sell out of one fund if a significantly lower ER fund or ETF that does the same thing appears. This has occurred a lot lately as the ER war between Vanguard, Fidelity, and Schwab has raged. I honestly don't think a difference of a couple basis points (0.02%) matters but if the difference is 5, I'll move. Some years ago, I moved $260k from my Fidelity international into a new Vanguard account and bought developed international over about 5 basis points. Good for $130 in savings. As it turns out, with the current ER wars, Fidelity is now cheaper, but only by a basis point.
If you want to find the lowest ERs, don't leave out Schwab. SCHB (broad market, like total market) and SCHX (similar to S&P 500) are both 0.03%. Unless you have some number of millions to get the uber cheap ERs in Fidelity, these are as cheap as you can get.
Another option to consider if you really, really have to have Vanguard is to buy Vanguard ETFs at TDAmeritrade. With enough money to invest, you can collect a bonus coming in. Then sign up for no fee ETF trades and choose from a dozen Vanguard ETFs. I hold VTI at TDAmeritrade because I like this Vanguard product but I don't like the bankers hours Vanguard holds and I don't like talking to some high school kid at Vanguard who knows nothing if I call with a question.