Hag in the Water — Barbara Hambly

A novelette of 15,000 words, sequel to Hambly's Dragonsbane (Winterlands) series. When a gnome wizard is murdered, the other gnome mages, fearing the killer was a demon, send for human witch Jenny Waynest. Unfortunately, Jenny is away. Her non-wizard partner, the scholarly Dragonsbane John Aversin, steps in to help solve the crime.