I think it's good the co-leader spoke up. It might have been awkward for her, but it seems like the kind of thing someone ought to point out, especially since the parent seemed oblivious at first. I think the co-leader was in a good position to say something, since she was the leader of a group the girl was in and thus her temporary carer for that time. It's a more difficult question if you're just an acquaintance and happen to notice it, but I think when your position involves supervising the child for a certain time, it's more appropriate to mention things like that, like you would mention to the parent if the child had been badly behaved or seemed to be getting ill or something.
As for the girl, it's possible it could be a "no bathing" phase she's going through. Maybe her parents are of the opinion that if they just let it play out, she'll experience negative consequences, like other kids telling her she smells, and thus change her mind on her own.