POWER1 -------> REGULATOR-----------> GPIO EXPANDER (for example)
| Enable |
| |
POWER1 --------> MCU ------------------------------ I2C Bus
It's horrible, but I think It's enough to imagine what I'm talking about.
In your example you can better use a small p-fet to cut power to the gpio expander. Not that it makes much sense since the expander does not consume much power only if it has active outputs it will consume but you can also shut those down with software.
No, shutting down the regulator and thus entire power supply only makes sense if multiple devices are being powered by it, so you save a lot of power.
Take for instance this example from TI, now the TPL device is a timer device that just waits for a preprogrammed time and then again wakes up a microcontroller or as in this example enables the LDO that supplies the power to the microcontroller.
This device consumes 26nA so can be fed by a battery for a very long time. Now instead of a low power microcontroller fed by a battery you can also imagine the LDO being fed by a power supply that will power a more hungry microcontroller and even more hardware that will consume hundred(s) of mA's but only has to run occasionally.
So for instance you have an application with a display and user interaction blabla that has to run if someone is walking along.
The microcontroller would normally poll (or through irq) a PIR sensor and do absolutely nothing until eventually someone is detected, then it can go to work.
In a stupid application this consumes 24/7 that hundreds of mA's.
In a smart application the microcontroller disables all other hardware and goes to sleep for an x amount of time then wakes up and polls the PIR. But with heavy microcontrollers even in sleep they will consume multipe mA's.
Now instead you can use this application, you can "program" the TPL time with the resistor for lets say 1 second and then the microcontroller is powered up every second, polls shortly the PIR sensor (that probably does need to be powered 24/7 but it is an example) and if nothing is detected signals the TPL with the done signal and the TPL shuts the LDO (power) down and waits another second.
If the polling routine takes 10ms you save 10/1000 = 99% of power that is otherwise thrown away. Just an example, probably better examples can be found.