Is it necessary to texture your games via UV mapping? I want to just be able to assign material colors to game objects (mainly for testing puposes)
instead of UV mapping and having the game run incredibly slow. Is that at all possible?

If you just want to do it for testing purposes, you can vertex pain your objects the desired colors. ALso, if you place a light in the scene and set lighting up you can "bake" the material color into the vertex colors using the "make vertcol" button in edit buttons.

You cannot use materials directly though.

You find a tutorial here:
http://members.yourlink.net/gruff/pink/
If you are using vertex paint, maybe your objects get quite bright sometimes. I'm not sure if this must be and it may depend on the lightning, but I got better object-colors (reflecting) with UV-texture than with vertex paint. But for testing, vertex paint will be the easiest. Just try.

Ingo