While an oxygen ball of gas isn't possible, an Oxygen rich atmosphere on a planet, through photosynthesis is possible. Earth for example. A hydrogen rich planet (Jupiter or Saturn) are also possible, as is a methane rich atmosphere (Titan).
If two bodies like that were to collide, you probably would see an enormous flame by the oxygen and fuel combustion process. That said, the gravitational impact would generate far more energy than any chemical combustion. If you were to collide two planets with atmospheres that together could combust, I'm not sure it would make much difference than two planets combining with atmospheres that wouldn't combust. The impact is what would stand out.