This seems to happen mostly at birthdays, but I always seem to get one kid who right at the start of my show (I usually open with the MDB) says "I saw your mouth move" but then it's never mentioned again for the rest of the show, and they get right into it with the characters.
Is the the equivalent of "I know how you did that" for magicians?
Sometimes when a child says that they saw your mouth move they really mean, "I saw your tongue move." If I hear it I have a routine I slip into.
child: I saw your lips move!
Vent: That's right. If you watch closely you can see my tongue move when he (the puppet) is talking.
Figure: What? Are you sticking your tongue out at me.
Vent: No. Every time you say something, I'm talking. That's called...
F: That's called rude!
Vent: It's called ventriloquism. I am a ventriloquist.
F: I don't get it.
Vent: You see, my hand is inside of your head.
F: Are you a brain surgeon?
Vent: And my fingers are here in your nose.
F: That's disgusting.
V: My thumb is in your mouth.
F: You should suck your own thumb.
V: Anyway, that is how you work.
F: I don't work. I'm retired.
V: If you sing a song then they will see my tongue move.
F: Are you serious?
F: I have to see this!
V: Okay, you sing a song and they will watch my tongue.
F: Cool! (sing any song and have the figure keep sticking his face in front of yours as he tries to watch your tongue. This blocks the kids' view and is funny.)
V: Let the kids' see!
F: They don't want to watch you! They want to watch me!
V: Well, that's true. Now where were we? (go back into the skit)