We investigate the pp --> pp e+e- and quasifree pn --> pn e+e- reactions within an effective Lagrangian model at the laboratory kinetic energy of 1.25 GeV for which experimental data have recently been reported by the HADES Collaboration. The model uses a meson-exchange approximation to describe the initial nucleon-nucleon (NN) scattering. Contributions to the reaction amplitudes are included from the NN bremsstrahlung as well as from the excitation, propagation and radiative decay of the Delta(1230) isobar state. It is found that the HADES data on the e+e- invariant mass distribution in the pp --> pp e+e- reaction are reproduced excellently by our model where the Delta isobar term dominates the spectrum. However, the quasifree pn --> pn e+e- cross sections are underpredicted in the invariant mass region of 0.40 - 0.55 GeV/c^2 even after including contributions of the eta Dalitz decay and the subthreshold production and decay of the rho^0 meson via the baryonic resonance N*(1520). In the case of the quasifree pn --> pn e+e- reaction, a strong sensitivity to the pion electromagnetic form factor is observed which helps to bring the calculated cross sections closer to the data in the higher dilepton mass region.