I found this response to the problem in the MacRumors forum:
"Syncing of music via iCloud (iTunes Match) precludes syncing of music via iTunes. This is not a bug, you simply must decide whether to use iTunes OR iTunes Match but not both, to sync music on your phone. To stop syncing music via iCloud and use iTunes to configure what is synced, on your phone go to Settings / Music / iTunes Match and turn that OFF. Then go back to iTunes on your computer, then Devices / [Phone name], select Music from the top menu, configure your sync settings, and click Sync.
"Alternatively, if you wish to use iCloud/iTunes Match to sync but only via Wi-Fi, then on your phone go to Settings / Music / iTunes Match, make sure it's on, and change its subsetting "Use Cellular Data" to OFF. However, this may prevent you from listening to your music via phone when you are away from a Wi-Fi network."
I unchecked the iTunes Match on the iPhone and the music synced fine.