The book I read was called The Magic Circle by Donna Jo Napoli. The main character was a kind, but hunchbacked lady. She was called the Ugly One. The setting was were the Ugly One lives, which is deep in the woods. She had a daughter named Asa which was the center of her universe. She also had a friend called Bala. These two people were her only companions. The book The Magic Circle, is really just the classic story "Hansel and Gretel". However, the story is being told from the witch's point of view.
The Ugly One helps people in difficult births. Then one day she was encouraged by a neighbor to try healing people and controlling demons. She becomes known for her ability to control and command demons from her magic circle. she is well rewarded for her magic by beautiful objects like jewels, diamonds, etc. One day, she became careless and was taken by the very demons she commands. Accused of witchcraft, she is sentenced to be burned. The demons help her escape, and she runs far away from her village. She lives by only doing whatever she needs to survive and to protect her mind from the demons. She then decorates her house with candy made from beet syrup. This was the only reminder of her daughter she had. She has shut out the demons for about nine years. But then two children come, the brother and sister, Hansel and Gretel.