I typically just collect a few smoke powder barrels from different areas.... Go chat her up and turn her help down so she goes about her day in her little home. Walk over and sit 3 or 4 barrels of smoke powder around her.... Move way back... firebolt/fire arrow from a distance.... BOOM dead hag. Wait a few rounds for the fire to calm down and collect loot. I did have a little luck once using a silence scroll on her to buy myself another round or two of melee combat. But the explosion route is always quick and glorious!
