You ask about a worst case scenario setting off a nuclear explosion. Although it is probably impossible, what would happen? Most of the early nuclear testing was done in the 50's, the US testing at Bikini Atoll. Although the explosions were large and spectacular, they did not affect anywhere other than Bikini Atoll. If a submarine collision caused such an explosion not on an island or lagoon but at the bottom of the ocean, the result would be even less apparent. The shock effects would be less than most volcanoes and earth tremors. The light and primary radiation would be absorbed by the water. There would be some radioactive waste and the location would probably be uninhabitable for years. Bikini Atoll is more or less habitable now, 50 years later. But, the bottom of the ocean is uninhabitable anyway. Some radiation would be spread, but the ocean is huge and the amount of background radiation in the world would not change much.

Probably it would actually be a worse case scenario if, as expected, the missiles did not explode but the subs were destroyed. Then the warheads would remain, possibly being recovered by who knows whom at some future date.

While no nuclear explosions on earth are good, the bottom of the middle of the ocean is probably the best place for one to happen.

Nuclear weapons do not go off because you bang them together. It takes significantly more energy to initiate the reaction than that. Of course should there be some other sufficiently powerful explosions on the ships, it is within the realm of possibility that the warheads could explode. This would pose a larger problem for surrounding land than for the ocean since the radiation would be blown into the atmosphere. The consequences of that are well documented. Nuclear weapons were frequently detonated under water for testing purposes.

The worst thing that could likely occur from these submarines colliding would be the release of radioactive material from the warheads being damaged. Depending on the quantity of the release and the currents, it could devastate huge areas of ocean.

Without being an expert, and knowing info that is bound to be classified, it's hard to imagine that a collision would trigger an actual nuclear explosion. The bigger worry would be radiation leaks from the subs nuclear power plants.

In order to trigger a nuclear explosion, the fissionable material (e.g. plutonium) in the warhead would need to be compressed very fast and very symmetrically into a critical mass. That can't really happen by accident. It is the kind of thing that scientists had to spend years working out how to make happen. All the pieces have to be in place just so, and I believe they make sure that does not happen unless they are ordered to be ready to launch.

The other kind of warhead, H-bombs, are even harder to set off and need the extreme temperatures of a "regular" atom bomb to trigger.

Even the Campaign for Nuclear Disarmamanent (CND) is not suggesting the risk of an explosion was a worry. Their worry is radiation leaks, and warheads going astray:

CND chair Kate Hudson said: "The collision of two submarines, both with nuclear reactors and nuclear weapons onboard, could have released vast amounts of radiation and scattered scores of nuclear warheads across the seabed."

http://news.bbc.co.uk/1/hi/uk/7892294.stm