The channeling spell holy water creates enough holy water for a small vial. This shold be and is describes as a perfectly good weapon for defeating undead. However, how exactly do you resolve attacks and damage done to undead by holy water?
In my group, holy water is used mainly to sprinkle over deanimated undead post-combat, to prevent them from reanimating (e.g. permanently destroying them).
The Elemental priest base spell "Elemental Water" from Fire&Ice presents a similar problem; the water (now half a pint) is described as having the ability to deliver an A critical of the appropriate type. How do you resolve attacks with half a pint of water? What if the players insist on filling the water into a barrel? a fragile flask? Soaking a rag with it? Is the elemental water somehow de-elementalized once "used"? if 70 goblins step into a pool of elemental water, will they all take a critical?