Osha must be participating in a challenge in order to trigger her ability. Because the "remove" part of the ability is separated from the "stand" part by the word "then," the "stand" cannot, and will not, happen unless the "remove" part is successful. (See, "The word 'then'," p. 21 of the RRG).
Also, challenges always go to resolution, barring any effect that specifically ends the challenge. So if Osha is stood and removed, the challenge will continue even if she was the only participating character.