Structural studies of biological macromolecules are severely limited by radiation damage. Traditional crystallography curbs the effects of damage by spreading damage over many copies of the molecule of interest. X-ray lasers, such as the recently built LINAC Coherent Light Source (LCLS), offer an additional opportunity for limiting damage by out-running damage processes with ultrashort and very intense X-ray pulses. Such pulses may allow the imaging of single molecules, clusters or nanoparticles, but coherent flash imaging will also open up new avenues for structural studies on nano- and micro-crystalline substances. This paper addresses the theoretical potentials and limitations of nanocrystallography with extremely intense coherent X-ray pulses. We use urea nanocrystals as a model for generic biological substances and simulate primary and secondary ionization dynamics in the crystalline sample. Our results establish conditions for ultrafast nanocrystallography diffraction experiments as a function of fluence and pulse duration.