Yes, Water Candles increases the spawn rate (the chance to spawn an enemy every frame) and the maximum amount of enemies in the world, so that will increase the amount of Meteor Heads.
A quick note that Meteor Heads don't drop anything in hardmode (including meteorite, coins or biome keys) so there is no point farming them in hardmode.
DragoTheDork, I saw your post previously that you were pre-hardmode, but mentioning this in case anyone else comes across the thread.
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