I connect from Python 2.7 to Oracle data base. When I use:

cursor.execute("SELECT column1 FROM table").fetchall()]

I have got almost proper values for column1 because all Polish characters ("ęóąśłżćń") are converted to ascii one ("eoaslzcn"). Using another tool like SQLDeveloper and using the same select statement I get proper value.

Try setting the environment variable NLS_LANG to your database language string, something like

os.environ['NLS_LANG'] = 'POLISH_POLAND.EE8MSWIN1250'