Normally, as you already know, water-based substances and oils/butters don't mix. However, heat alone is not enough to cause the blends to mix and not "split" again afterwards.
In addition to the heat each one of my DIY Hair Recipes contains an "emulsifying agent" (the cationic compounds, BTMS or cetrimonium chloride or cetrmonium bromide) - that is a chemical that helps the water and the oil to blend.
But, heat and an emulsifier are again not enough to make the oil and water to mix without "splitting" again afterwards. The stirring motion also helps with the emulsification process.
Think about it this way, if you make a cup of tea and add a solid block of sugar it might not completely melt if you don't stir. To dissolve the sugar you need: (1) a solvent called water, (2) heat, i.e. hot water, the sugar would not melt well in cold water and (3) stirring. It's pretty much the same deal deal with making conditioners and other hair products that combine oils and water-based inputs.
In addition, the heat kills any contaminants that might have been in the ingredients. Having any unwanted bodies in the formulation would make it rot faster.
In summary, to mix water and oils/butters you need:
1. An emulsifying agent
3. Stirring action
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