She did. According to Baum's book The Wonderful Wizard of OzThe Wonderful Wizard of Oz: The Witch was too much afraid of the dark to dare go in Dorothy's room at night to take the shoes, and her dread of water was greater than her fear of the dark, so
The Witch was too much afraid of the dark to dare go in Dorothy's room at night to take the shoes, and her dread of water was greater than her fear of the dark, so she never came near when Dorothy was bathing. Indeed, the old Witch never touched water, nor ever let water touch her in any way.
So she never came near when Dorothy was bathing. Indeed, the old Witch never touched water, nor ever let water touch her in any way. So from nor ever let water touch her in any way., and her dread of water was greater than her fear of the dark, so she never came near when Dorothy was bathing., we We know that she knew that she melted to a puddle of scum once she touched water.