The size is not actually the OD of the collet at the largest point, more like a nominal size. If you measure one it will be oversize. Perhaps they may measure on point when compressed to their nominal range. ER collets have a clamping range of .039mm/1mm, much wider than R8, 5C, etc.
Ultimately it's the max tool size that will base your decision on which size to buy. I have heard that the larger sizes don't hold smaller sizes too well, ie ER40 won't hold 1/8" shanks well, etc. Not sure of the truth in that but I use ER40 for 3/8" - 1" & ER16 for 3/8" & smaller. I like the ER16 for tighter areas where the ER40 won't fit with a smaller endmill. ER32 (max 3/4") is a good all around size for our size mills.
Technicks make the best quality ER collets you will find for an import & are all I use. Made in Taiwan. Hemly Tool & All Industrial on ebay have the best prices on them. Nemic tools has them cheaper so if buying a few at a time that's the place place to buy. ER collets were designed by Rego Fix & are the most used collet system worldwide. I have heard Glacern ER chucks are made by Rego Fix but I'm not sure of the truth in that. I do know they are very high quality though. For the mill I have an ER16 chuck from Glacern & I have 2 ER40 chucks from Bison/TMX.
And I also use ER40 & ER16 on the lathe.