I think they actually mean the guard guys and the funky looking monkey dudes. When Dorothy kills the witch one of the guards comes over and says something like "You killed her!" Then Dorothy being the compulsive liar that she is says that she didn't mean it and all that stuff. Then I'm not totally sure but I think that they all cheer for her. I don't remember any of them saying "Judy" but I haven't seen it in ages.
Huh? When Dorothy kills the Wicked Witch of the East, in Munchkinland, the Munchkins are not present. They only emerge later, and as yet do not know Dorothy's name at all (she emerged from the house that squashed the witch).
When Dorothy kills the Wicked Witch of the West, she is in the Witch's castle, not in Munchkinland, so of course no Munchkins are present. At neither time do Munchkins gather around her calling out her name. What scene are you referring to?