@nk The only technical difference is really the fewer features MPV comes with, it's really just all you need for streaming videos from online video platforms or direct URLs, as well as viewing or listening to locally stored files.
VLC on the other hand has more features available in the GUI, while MPV is more suitable for use in things like dmenu, Rofi, or the command line.

But it's ultimately a matter of preference, there's no real winner or loser between the 2.