The Church of the Perfect Light really doesn't like witchcraft or witches, but most of the conflicts between witches and priests happened ages ago, and the two can exist uncomfortably with each other.
More impressively, the study of High Magic was for a long time part of the Church. As mentioned in an earlier post, the discoverers of discordium were theologians. After that discovery, magic began to evolve into its own branch of study separate from Perfect Light theology. Seeing this, the Radiant Synod decided that learning might flourish better outside Church walls, so they sanctioned the establishment of Libraria, where scholars who did not always strictly comply with Church doctrine could work and still benefit the Church with new magical discoveries. These quasi-religious institutions eventually evolved their own secular culture and customs. The relationships between Libraria and their parent organization, though they have sometimes been strained, are cordial.