He's done it three times previously. Notably he replace Rudock with CJ. Rudock ended up starting for Michigan and then having a stint in the league. So, its not like he hasn't made difficult decisions to replace a good QB with a better QB when the situation dictates.
I also believe this decision is much more on Brian and the offensive staff. If Brian went to KF and said we think we should make a switch, I doubt KF would overrule his coaches.
I am confident KF sees that Petras and the offense as we do, and they have been well below snuff the last two seasons. I think KF would welcome an upgrade at QB. Unfortunately, it seems that the two guys behind Petras are not an upgrade. Labas is unproven and it may be that Padilla is, well, proven. Either way, tie goes to the incumbent in these scenarios and between experience and mediocre talent and inexperienced and mediocre talent, might as well go with the guy who knows what he is doing.