This happened in a remote village called Sierra Morena,  t. There were three siblings named : Camila, Antonio and Julian.

One day they decided to go to a witch's house, because they wanted know if the whitch had hidden a great treasure.

When they arrived, Camila sayid to her  brothers:, “ I don't think that's a good idea, the whitch could catch us".

It's conventional to use commas before dialogue.

Julian replies her " id, "If you're afraid, turn back right now".

Changed to past tense to make it consistent with the previous sentences, but it's possible to use present tense (Julian says) if it's consistent throughout.

She thought, wisely, "okOkay, I'd rather be a coward than be killed by a witch".

It's also common to separate adverbs that come after verbs with a comma

The others brothers entered the house when the whitch was outside, t. They quickly searcherd for the treasure but found nothing.

Antonio sayid to Julian that it's time to go  back home, but he replies " yd, "You are a coward w. We've almost found it."

Making sure the keep the sentences separated with punctuation in the dialogue.

There was a large drawer with a padlock and. Julian smiled and said:, "wEe found it!", w When they opened it, ohthere was a surprise!,

Splitting a run-on sentence.

There was a skeleton whith a note that read: " hHi boys!, w Welcome to my home",  t. They screamed loudly when the whitch suddenly appeared whith a machete, t. They had no escape and began to pray.

Suddenly a gunshot rang out, i. It was his sister that who had killed the which, titch. They thanked her through tears, returned home, and learned not to be greedy.

You can use either "sister who had" or "sister that had", but not both "that" and "who". For people, "who" is more common.