Well, my prediction is that Emilia is the witch, after all. She gave Subaru her core powers to get rid of the smell that now haunts Subaru. But since everybody is convinced that Subaru cannot be the witch and is just some stranger idiot, that doesnīt matter. At the same time, the witch made sure to flirt with Subaru in a way that has made him give it his all to support Emilia. Itīs really atypical how Emilia is accepting of Subaruīs constant flirtatious approaches, no matter how cringingly direct he is, she takes it and neither blushes nor gets angry.
My guess is that the witch cannot, for unknown reasons, accomplish something on her own. She needs to become the landīs ruler. Therefore she uses people from our world as her unknowing servants. She infatuates them with herself, then watches as they go through hell to try and make her happy. The time reset makes sure that nothing can truly go wrong, itīs a both a "tool" to use for her servants, as it is also a fail-safe for her.
What happens when she realizes that her servant has failed, can be seen with Betelgeuse, who i suspect to be a former servant of hers. Having gone through hundreds if not thousands resets, that guy has completely lost his mind. And we had the first signs of Subaru losing it, too, in ep 15. There we also saw Emilia reacting in a disappointed manner towards him.

I think the ending will be tragic no matter what. Either the witch wins because nobody suspected Emilia OR Subaru has a final mental breakdown once he realizes he needs to kill Emilia and end her curse to make it all stop.