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Pricing is one aspect, but OSS solutions bring community and a level of transparency that most closed source companies don't.

Until the VCs turn the screws and they don't anymore.

If that happens, fork. It's (literally) free.

Does that ever work in practice? Has there been a standard fork of Audacity that everyone flocked to since they got purchased by Muse?

Tons of example. Most wildly used forks out there are probably WebKit and Blink, the engines of two popular browsers.

Some other notable projects that started as forks: postgres, Wordpress, Apache Server, OpenSSH. I'm sure there are others I forgot.