Assign cycles material to mesh in script I have a mesh object, and I want to fiddle with its material properties in Cycles through a script. I have tried this:

I created an object:

g_d = bpy.data.meshes.new(name="GroundM")
g_o = bpy.data.objects.new(name="GroundO", object_data = g_d)
scene.objects.link(g_o)
g_o.location = (0,0,0)
g_o.select = True
scene.objects.active = g_o


Next I define the material to be made, and what to do with its nodes

def create_cycles_material(name):

    mat = bpy.data.materials.new(name)
    mat.use_nodes = True
    nodes = mat.node_tree.nodes

    node = nodes['Diffuse BSDF']
    node.location = 600, 120
    pass   # Some more node-engineering here


Next, I define a function that should link a material to a mesh object:

def setMaterial(ob, mat):
    me = ob.data
    me.materials.append(mat)


Finally I make the material and assign it to the mesh object g_o:

ColoredGround = create_cycles_material('GroundCol')
setMaterial(g_o, ColoredGround)


The object appears as it should be, and the material with all its specified nodes is created somehow, but I still have to go to the object afterwards and manually add a material and then select the material that I scripted, to assign it to my mesh. 
I did look into this answer applying to Blender Internal render as well but I still can´t figure out why my script does not work.
As batFINGER mentioned, you just forgot the return statement.
I tried out your code (and had to modify it a bit, because I got the error that 'scene' was not defined) and it worked fine when I added return mat to the function create_cycles_material.

Here's the ready to use code:

import bpy

def main():
    g_d = bpy.data.meshes.new(name="GroundM")
    g_o = bpy.data.objects.new(name="GroundO", object_data = g_d)
    scene = bpy.data.scenes[0]
    scene.objects.link(g_o)
    g_o.location = (0,0,0)
    g_o.select = True
    scene.objects.active = g_o

    ColoredGround = create_cycles_material('GroundCol')
    setMaterial(g_o, ColoredGround)

def create_cycles_material(name):

    mat = bpy.data.materials.new(name)
    mat.use_nodes = True
    nodes = mat.node_tree.nodes

    node = nodes['Diffuse BSDF']
    node.location = 600, 120
    #pass   # Some more node-engineering here
    return mat

def setMaterial(ob, mat):
    me = ob.data
    me.materials.append(mat)

if __name__ == '__main__':
    main()