I'd certainly allow them to swap out a spell for a higher-level spell whose effects encompass those of the spell they're swapping out. So, for instance, when you get an additional 2nd level spell, you could replace your Monster Summoning I with Monster Summoning II, and then take a new spell to occupy the newly opened 1st level slot.
Then again, I really don't like the way the Sorcerer class was implemented. If/when I run D&D again, I'm not going to have any Sorcerers in my game world. (There will be a Thaumaturgist class with a similar implementation, but they'll be divine spell-users instead, with their limited spells known explained as each spell coming from a pact with a specific extra-planar entity.)
- Eric