Three-dimensional hydrodynamical simulations are presented for the direct head-on or off-center collision of two neutron stars, employing a basically Newtonian PPM code but including the emission of gravitational waves and their back-reaction on the hydrodynamical flow. A physical nuclear equation of state is used that allows us to follow the thermodynamical evolution of the stellar matter and to compute the emission of neutrinos. Predicted gravitational wave signals, luminosities and waveforms, are presented. The models are evaluated for their implications for gamma-ray burst scenarios. We find an extremely luminous outburst of neutrinos with a peak luminosity of more than 4E54 erg/s for several milliseconds. This leads to an efficiency of about 1% for the annihilation of neutrinos with antineutrinos, corresponding to an average energy deposition rate of more than 1E52 erg/s and a total energy of about 1E50 erg deposited in electron-positron pairs around the collision site within 10ms. Although these numbers seem very favorable for gamma-ray burst scenarios, the pollution of the $e^pm$ pair-plasma cloud with nearly 0.1$M_{odot}$ of dynamically ejected baryons is 5 orders of magnitude too large. Therefore the formation of a relativistically expanding fireball that leads to a gamma-ray burst powered by neutrino emission from colliding neutron stars is definitely ruled out.
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