A number of reasons I prefer to use my 5C's in a lathe:
1, Yes they only operate over a very narrow window but then most of our drawings are to the nearest 32nd of an inch, 5C's as standard can be brought in imperial sizes (and metric) so they will fit the work perfectly . ER's operate over a wide range of sizes typically for the cheap ones 1mm that means that most of the time they hold on 8 points not all the way around. Only on one size will the curve on the inside of the collet match the work piece. So most of the time as Jason says a good three jaw will be as good.
2, If you look at Neils photo you will see that most of the ER collets have a chamfer on the inside of the nose, that limits the minimum depth you can hold on. I often hold small work on less than 1mm in a 5C without any worry.
3, My 5C's go up to 28mm, my ER32s only 20mm. But 5C's don’t limit you there as you can also get expanding collets and oversized soft ones that let you make special sized collets go up to 3". Also brass and nylon ones that are designed to let you do clever things with.
4, I have not got a face mounting ER collet chuck so if I used them on the lathe I would be limited in the available depth.
5, I have got a Stephenson’s spin indexer which takes the ER collets but most of my work is in imperial sizes so I might as well continue to use the 5C’s in the head to hold them. One day I might find a need to use the ERs in the spin indexer if so they are available.
6, The 5C collet chuck is very nice to use, faffing around with a spanner to tighten the ERs on a lathe without a headstock lock is a pain: I tried it once and didn’t bother again.
But If I am doing smaller stuff I will opt to use the Cowells which means that I will be using the DA200’s which start at 1.2 mm and go up to 10mm in 0.4mm steps, so in many ways the 5C’s are more accurate than even these ultra precision collets, but the Cowells is so nice to use when working to extremely small tolerances. If I want to go smaller then the watch maker’s turns come out and that is a totally different ball game.
Jo