All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad is His slave and Messenger.
As for your first question, if the reality is as you mentioned in the question, that the amount is granted as a will, then this will is not valid because you are an heir and allotting something for the inheritor as a will is not allowed, for the saying of the Prophet : “There is no will for an inheritor.” [Abu Daawood]
Therefore, you do not deserve this amount and you are not permitted to give it in charity except with the permission of all other inheritors. If they permit you, then it is permissible for you to act freely in that amount and you may spend it in any lawful matter. You may spend it in charity (with a continuous effect), or use it in stocks provided they are lawful.
You may even add part of your own money to this money and make it as endowment. However, if the inheritors do not permit you to take the money, then you cannot take it and you should put it back to the inheritance to be distributed among all other heirs.
As for your second question, if it is proved that that woman is really involved in magic, then you have to exhort her, advise her, and remind her of Allaah and the gravity of this act. Tell her that most scholars are of the opinion that a magician is an apostate and is out of the fold of Islam, and thus, he/she should be killed. It is more likely for her to take heed if scholars or noble people advise her, so it would be better to leave the task of advising her to them. If she does not give up such practice, then you have to abandon her, as this might deter her.
As for blaming her for causing the death of your father by magic, then this should not be claimed unless there is clear evidence. You should ignore the man's claim that she caused the death of your father unless there is a sound proof. He might assume so based only on some suspicions or on information of devils or something which does not stand as proof that is accepted in Islam, especially when the matter is related to the accusation of a Muslim killing another Muslim.
Allaah Knows best.