Thank you for the feedback!
For the Witch, you're able to defeat her after finding all of the gold in and outside of Lily's(and the sword), finding the axe in the village, selling the sword and buying an Elemental Cloak from the shop.
Once you defeat the Witch, you will be able to loot her house which includes learning your first spell. Defeating the Witch also opens up the Fairy Den to the west of her house, which is a fletched-out story where you bring items to the Fairy to be able to serve her.
One of the items you will need to bring her will be a Mandrake Root, dropped from the Treants in the Forest. You will be able to one shot the Treants with the spell learned from the Witch. (I uploaded a complete guide to v.01 in the devlog)
There's also more content to the east of the forest, which leads to the end of v0.1 where you defeat the castle guards in the village.
I will work on fixing collisions and hopefully adding more art to the beginning characters, as when I was starting the game/those characters I was 'getting a feel' for how I wanted things to go. Later characters are more fletched out with art!
Thank you!