Yes. "Nutty" has two meanings. The most common meaning is "crazy." It is an informal use. It is an insulting and disrespectful thing to say. It means that some idea is crazy, foolish, wrong, and of no value. For example, "people once had the nutty idea that you could learn things by listening to recordings while you were asleep." Or "My friend Janet has some nutty political ideas, but we are friends anyway." "Tastes like nuts" is actually the less common meaning. For example, "South American coffee tastes nutty and earthy." Those are the main meanings for "nutty." "Nut" has a lot of meanings, including one vulgar slang meaning which you can look up yourself in a dictionary.

"nutty" - mad; crazy. "he came up with a few nutty proposals"

This is also word where the noun can become an adjective. That idea is nutty. (Crazy, ridiculous, not reasonable. I would not say this) That idea is nuts. (Same meaning, but what I would say) If he thinks he can marry Emma Watson, he’s nuts!

Yes, informally. Formally, nutty means tastes like nuts meanwhile informally when someone use the word "nutty" means what they're referring to is crazy or mad. Informally, I can say "I think I am getting nutty". Hope it helps?